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COVID 19 fraud allegations often involve False Claims Act

Houston Healthcare Fraud Attorneys

Experienced False Claims Act defense lawyers explain how process works

More than $2 trillion in federal aid has been designated for Coronavirus COVID-19 relief for individuals, small businesses and corporations, according to The Houston Chronicle and many other news sources. Additional federal relief funding is anticipated, as well, to help people and businesses struggling financially due to the Coronavirus COVID-19 pandemic nationwide.

Concerns have been raised about who will oversee the $2 trillion to make sure these funds are used properly. In most cases, most appropriations will fall under the oversight of the U.S. Department of Justice, which is reorganizing itself to act swiftly against pandemic-related irregularities. Bharat Ramamurti has also being appointed by the five-member Congressional Oversight Commission to serve as a watchdog to oversee spending of the $2 trillion in federal aid, according to ABC News, The Los Angeles Times and other news sources.

As a result, many experts have warned that this government funding could be misused or misspent by individuals or businesses.

“Everybody’s acceptance of some or a lot of fraud is going to have to be high, because it’s going to happen,” Earl Devaney, who served as the top watchdog of the Recovery Accountability and Transparency Board, said in an interview with ABC News.

Even if businesses follow the rules, they should be prepared for a government investigation into how they spent their federal Coronavirus COVID-19 relief funding. Certain businesses can expect to receive a closer look than others, according to qui tam attorney* J. Mark Brewer of Brewer, Pritchard & Buckley, PC, in Houston.

“Federal prosecutors will be looking carefully at healthcare, procurement, and loan/grant programs,” Brewer said. “And the primary weapon federal prosecutors will be using to go after businesses will be the False Claims Act.”

What is the False Claims Act?

Sometimes known as the "Lincoln Law,” the False Claims Act (31 U.S.C. §§ 3729 - 3733) was created in 1863 during the Civil War in response to allegations of military contractor fraud. Since then, the federal government has expanded the scope of the False Claims Act to include nearly all allegations of government fraud.

The purpose of the False Claims Act is to allow the government to recover money when someone submits a false or fraudulent claim.

How does the false claims act work?

False claims are not billing mistakes. Instead, they are claims that medical providers knew were false or should have known were false. The act applies to healthcare when medical service is:

A medical provider who fails to comply with the False Claims Act can face a fine of up to three times the program's loss. In addition, a medical provider may be required to pay $11,000 per claim filed.

The False Claims Act also compensates whistleblowers who report fraud of up to 30 percent of the false claim recovery. Whistleblowers may include former or current employees, competitors, or patients.

The False Claims Act and the Coronavirus COVID-19 Pandemic

In terms of the Coronavirus COVID-19 pandemic, many healthcare providers can anticipate close scrutiny by the U.S. Department of Justice investigating allegations of False Claims Act violations. Examples include:

  • Allegations of healthcare fraud involving telemedicine
  • Allegations of Paycheck Protection Program fraud, which relies heavily on self-reporting
  • Allegations of healthcare procurement fraud

Whistleblowers often initiate these investigations. If your business is the focus of a whistleblower-initiated investigation into allegations of misuse of Coronavirus COVID-19 relief funds, talk to an experienced whistleblower criminal defense attorney at our law firm. We can analyze your case and explain the legal options available to you. Contact our Houston law firm today. We handle cases nationwide.

*Not certified by the Texas Board of Legal Specialization.

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