Whistleblowers Can Reverse the Decline in Defense FCA Cases
Each year in Fraud by the Numbers, we have lamented the historic decline in defense contracting False Claims Act (FCA) cases. It’s an ironic trend given the FCA’s origin as a means of fighting fraud by military contractors in the Civil War.
In 2024, the federal government recovered about $93 million in Department of Defense (DOD) via FCA cases. That’s a mere 3.2% of the over $2.9 billion recovered through the FCA in 2024. Meanwhile, 57.4% of that $2.9 billion ($1.675 billion) was for healthcare cases.
That means that the government recovered 18 times more in healthcare FCA cases than it did in defense FCA cases.
The discrepancy on FCA recoveries between healthcare and defense cannot be explained by the overall spending difference in healthcare compared to defense. Yes, the government spends a lot of money on healthcare: $1.9 trillion in 2024. But it also spends a lot of money on defense: over $1 trillion in 2024. In particular, $445 billion was spent on defense contractors, more than the rest of the federal government spends on contractors combined.
How is it that defense contracting has so little FCA activity relative to its massive scale? DOD has reported $11 billion in “confirmed fraud” for fiscal years 2017 through 2024 via PaymentAccuracy.gov, a website operated by the Office of Management and Budget (OMB). “Confirmed fraud” includes only fraud cases that have been confirmed by a court or other adjudicative forum—it does not include anything settled out of court.
In June 2025, a senior Government Accountability Office official told Congress: “Recoveries and confirmed fraud reflect only a small fraction of DOD’s potential fraud exposure. They do not include undetected fraud and potential fraud detected by the agency that it has not investigated.”
This is why whistleblowers are necessary to uncover DOD fraud, just like they have been necessary to uncover fraud in healthcare and other areas of government spending. To ensure integrity in military contracting, the DOD and those interested in fighting fraud should encourage whistleblowers from the defense contracting industry to come forward.
This piece was written by Nicolas Mendoza, Senior Associate at Murphy Anderson.
