Although the majority of fraud cases are handled by the Department of Justice at a federal level, states also play an important role in identifying and prosecuting instances of fraud. Many states have their own False Claims Acts that allow citizens to become whistleblowers and report fraudulent activities. Although many of these state-level false claims laws focus primarily on healthcare, others can include any type of fraud committed against the state. Whistleblowers have been able to report misconduct by financial firms, telecommunication companies, charter schools, and more, and have received monetary rewards for their efforts.
Here are three noteworthy State-based FCA recoveries from 2021:
- Multi-state opioid settlement: Thousands of state authorities brought suit against the largest drug manufacturers participating and benefiting from the opioid epidemic. The companies involved were McKesson Corporation, Cardinal Health Inc., AmerisourceBergen Drug Corporation, and Johnson & Johnson. The allegations include misleading doctors and patients about the dangers of opioid addiction, and the failure to stop providing drugs to pharmacies that had suspicious drug orders. The companies settled the case by agreeing to pay $26 billion over the next 18 years, implementing oversight measures, and promising not to promote opioids.
- Centene Corp: This company was overbilling Medicaid programs in Ohio, Mississippi, and Kansas. They were charging prices above the industry standard price cap, failing to disclose discounts received, inflating fees, and getting reimbursements for medicine that was already paid by third parties. In the end, Centene had to pay $171.4 million to settle the lawsuit.
- Sandell: This tax fraud case, filed in New York under the state’s False Claims Act, alleged that Sandell was operating through a shell company in Florida in order to avoid paying New York taxes. They were ordered to pay $105 million in the settlement.
Do you have a valid claim?
If you witnessed any widespread suspicious activity within your workplace, you might have a chance of becoming a whistleblower by reporting an ongoing fraudulent scheme. However, to increase your chances of success, you must be sure to back up your claim with substantial evidence or privileged information.
A Quick Whistleblower Checklist
Is the fraudulent scheme widespread enough?
Has the fraud been perpetuated for years or involves large sums of money?
Do you possess any physical evidence of the fraud (documents, forged signatures)?
Do you have access to privileged information which may help our investigators?
Do you work as an insider within the company perpetrating the fraud?
Did you witness any ongoing illegal behavior within your workplace?
Have you been forced into taking part in any suspicious corporate activity?
