The False Claims Act

Since nearly the beginning of time, individuals have felt the need to cheat whatever government they have lived under. During the Civil War, both the North and the South were subjected to unprecedented levels of cheating and fraud. As a result, the False Claims Act, or “Lincoln Law,” was passed.

The Lincoln Law allows individuals not affiliated with the federal government to file an action against a federal contractor who files fraudulent claims with the government. The act of filing a claim against a corporation or contractor is known as “whistleblowing.”

Unlike other whistleblowing acts, the FCA allows for the person who filed the claim to recover between fifteen and twenty-five percent of anything recovered in damages from the fraudulent contractor. This act is a legal tool that is used to counteract fraudulent billing to the federal government. Sometimes the person making the claim has insider information of the false claims but this is not always the case. The most common false claims are filed in the realms of health care, military contracts, and other government spending programs.

There is some lore as to the direct cause of the False Claims Act. Some are convinced that the Act was a response to bad mules sold to the Union Army. This was not the only possibility for the cause.

In the early days of the Civil War, unscrupulous contractors sold the Union Army decrepit horses, mules in ill health, faulty rifles, dead ammunition, rancid rations and provisions, and all manner of other shoddily constructed items necessary for war. The Act was passed since the Justice Department was reluctant to prosecute fraud cases and so Congress felt it should encourage the general populace to sue on behalf of the government for fraud.

Contact a Houston Employment Attorney

If you have been subjected to retaliation for a whistleblowing action or have information pertaining to a company's fraud, contact the Houston employment attorneys of the Ross Law Group today at 713-482-6910.