False Claims Act Update & Alert |
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Taxpayers
Against Fraud Education Fund | Washington, D.C. |
WWW.TAF.ORG |
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CONTACT: James
Moorman,
"Over $14 billion of America's stolen money has been recovered by the Federal False Claims Act since 1986," says Jim Moorman, President of Taxpayer's Against Fraud, "but the real story is how much fraud has been deterred. "Hopefully, it is starting to sink in that if you rip off the Federal Government your own employees may turn you in." Moorman notes that the largest frauds tend to be "business plan frauds" which are organized by corporate managers and often copied by entire business sectors. "A company figures out how to game the system, and pretty soon their accountant or CEO moves to a competing firm and the con spreads," says Moorman. "In sector after sector -- laboratories, hospitals, drug manufacturers, defense contractors -- we see the same sophisticated frauds being repeated with only minor variations. "Right now about 85% of all dialysis clinics in the U.S. are under investigation for fraud, and it's all the same stuff. Some of these companies, such as Gambro and Fresenius, are repeat players with the False Claims Act, which suggests they are either slow learners or the original settlements with these companies -- hundreds of millions of dollars in both cases -- were not big enough. "One problem is that DoJ can't seem to process enough cases, especially big cases which are labor-intensive. "Last year DoJ took action on less than 90 cases, and at the rate they're going now, they're not going to do any better this year. "What's frustrating is that we know there are more than 125 cases against drug manufacturers cheating Medicaid and over 500 drugs are being investigated. This is on top of big cases against hospital corporations like Tenet, pharmaceutical benefit managers like Medco and Caremark, and defense contractors operating in Iraq. "The False Claims Act backlog at the Department of Justice is growing because not enough resources are being devoted to investigations and prosecutions. The problem is not just at DoJ, but at other federal agencies as well, such as HHS and DoD. DoJ Attorneys are swamped and are being forced to triage good cases. "The problem is not political, but a simple lack of resources and lack of support from top officials at the U.S. Department of Justice and supporting agencies. The False Claims Act is the Goose that lays the golden eggs, but the farmer is not doing the obvious things necessary to produce more eggs." A new report from TAF shows that every dollar invested by the government in investigation and prosecution of federal health care fraud returns $13 back to the American people. "It hard to think of a better return on investment,"
says Moorman. >>
To read report
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