Government Program Fraud, False Claims Act & Qui Tam Litigation Playbook

On Feb. 22, 2024, the US Department of Justice (DOJ) released its annual False Claims Act (FCA) recovery statistics and announced that it obtained more than $2.68 billion in settlements and judgments in fiscal year (FY) 2023 from civil cases involving fraud and false claims against the government, a 21% increase over the prior year's recoveries. As such, FY 2023 was another strong year for FCA enforcement and marked the fifteenth straight year where recoveries exceeded $2 billion. This past fiscal year also saw records set in several areas, including the highest number of settlements and judgments in DOJ history and a record number of civil investigative demands (CIDs) issued in connection with investigating FCA claims, revealing highly robust FCA investigative activity in 2023, which could signal even greater FCA judgments and recoveries in future years.

On August 26, 2021, the Department of Justice, the U.S. Attorney’s Office for the Southern District of Florida, and the Small Business Administration’s Office of Inspector General announced a $287,055 settlement resolving alleged violations of the False Claims Act related to a false loan application and misappropriated Paycheck Protection Program loan proceeds by All in Jets LLC owner, Seth A. Bernstein.

The United States Department of Justice (DOJ) continues its aggressive pursuit of those attempting to fraudulently obtain funds made available through the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), as reflected in its May 17, 2021 announcement of yet another criminal resolution of a case involving individuals accused of defrauding the Paycheck Protection Program (PPP).

On April 21, 2021, the Department of Justice (“DOJ”) and the U.S. Attorney’s Office for the Eastern District of California announced a second settlement resolving alleged violations of the False Claims Act (“FCA”) based on false statements made by a company and its chief executive officer in connection with the company’s loan application under the Paycheck Protection Program (“PPP”) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

On January 12, 2021, the U.S. Attorney’s Office for the Eastern District of California announced the first civil settlement resolving alleged violations of the False Claims Act (“FCA”) based on false statements made by a borrower and the company’s Chief Executive Officer in loan applications under the Paycheck Protection Program (“PPP”).

Within the span of eight days, the U.S. Department of Justice filed three criminal actions against three individuals for alleged schemes to defraud the Paycheck Protection Program established by the Coronavirus Aid, Relief, and Economic Security, or CARES, Act.

On Wednesday, May 13, 2020, the U.S. Small Business Administration (SBA) issued two updates to its Frequently Asked Questions (FAQs) regarding the Paycheck Protection Program (PPP).

With the passage of the Coronavirus Aid, Relief and Economic Security Act (CARES Act) on March 27, 2020, the risk that individuals and organizations may find themselves in the government's crosshairs has increased exponentially.

To address the economic impact of the COVID-19 crisis, Congress has allocated nearly $660 billion to the U.S. Small Business Administration (“SBA”) in forgivable loans to eligible small businesses, non-profits, and certain tribal entities. 

What are likely the first criminal actions that the DOJ has brought targeting COVID-19 fraud?

Both federal and state agencies and courts have adopted myriad actions in response to the ongoing coronavirus pandemic.