The Bureau of National Affairs (BNA) released an article titled False Claims Act May Increasingly Be Used To Target Financial Companies, Lawyers Say citing the False Claims Act as a compelling resource for the Department of Justice (DOJ) and whistleblowers looking to expose financial service firms that have allegedly defrauded the government. According litigation lawyers, this law dating back to the Civil War era, is being used in innovative ways to fight financial fraud.
Attorneys and analysts predict that two events will spur the increase in lawsuits brought against financial service firms alleging fraud:
The government's immense increase of tax funds into the financial services sector during the peak of the nation's financial crisis from 2007 to 2009.
A looming public perception that abuse occurred in the financial sector during the crisis and may be persisting into present day.
The article quotes Motley Rice member and former prosecutor Mark Labaton saying, "You'll see a large increase in cases wherever you see a large increase in government spending."
Established in 1863, the False Claims Act helps prevent government losses from being acquired when entities or individuals submit a false claim to the government for payment. The law creates liability for anyone who intentionally submits a false claim, fabricates statements or records, or causes another person to submit a false claim, in an effort to receive payment from government.
Visit the Department of Justice site for more information on the False Claims Act.
Read more about qui tam cases and whistleblower protection and how Motley Rice whistleblower lawyers are fighting on behalf of individuals and businesses suffering as a result of corporate fraud.