The infrastructure bill signed into law by President Biden on Nov. 15, 2021 released a $1.2 trillion flood of public spending on roads, transportation, energy, and the environment.
This large influx of federal dollars over the next five to ten years will create new American jobs while providing much needed road, water systems, and public transportation repairs, and internet and cybersecurity improvements.
With these increased Federal dollars come bad actors trying to steal this money through fraud. Whistleblowers have a long history of reporting and prosecuting all types of infrastructure fraud through the False Claims Act, which can provide them with an award if they recover money on behalf of the United States.
Roads and bridges will see $110 billion in new funding to repair existing infrastructure and support new projects, and another $11 billion for transportation safety. $39 billion is earmarked to modernize public transit networks across the country. Amtrak will receive $66 billion to improve safety, upgrade existing lines, and strengthen rail service outside of the Northeast. $65 billion has been slated for power infrastructure, focusing on improving electricity transmission lines to allow for the expansion of renewable energy.
A further $65 billion is designated for bringing high-speed, lower-cost internet to underserved areas. The infrastructure bill makes a $55 billion investment in clean drinking water, focused on replacing lead water lines. The bill also designates $50 billion to make our infrastructure more resilient against climate change, extreme weather, and cyberattacks. $17 billion will be spent on ports, and $25 billion on airports.
Electric busses and ferries will see a $7.5 billion investment, with another $7.5 billion for electric vehicle charging infrastructure. Mitigation of existing pollution, including Superfund and brownfield sites, will receive a $21 billion boost.
The government’s plan to spend an incredible $1.2 trillion on infrastructure projects creates an equally incredible opportunity for fraud—an opportunity that exists in all government spending programs. Fortunately, the False Claims Act is a powerful weapon to combat fraud against the public fisc. There are many examples, new and old, of courageous people reporting alleged infrastructure fraud:
- United States ex rel. Marcus v. Hess, 317 US 537 (1943) (bid rigging by electrical contractors on Public Works Administration projects)
- United States ex rel. Harman v. Trinity Industries, Inc., 872 F.3d 645 (5th Cir. 2017) (undisclosed changes to federal highway guard rails; a $686 million verdict for the Government was overturned on appeal)
- United States ex rel. Heath v. Wisconsin Bell, Inc., 2015 WL 10383178 (E.D.WI, 2015) (Currently in litigation, this case involves alleged overcharging for telecommunications and information services to school districts and libraries.)
- United States ex rel. Totten v. Bombardier Corp., Top of Form ·380 F.3d 488 (D.C. Cir. 2004) (Case involving defective rail cars sold to Amtrak)
- United States ex rel. Khwaia v. Washington MATA, D.D.C. (In 2014, the Washington Metropolitan Area Transit Authority paid $4.2 million to settle the Government’s claims for federal contracting rules violations.)
- United States ex rel. Citynet, LLC, v. Giannato, Given, Frontier West Virginia, Inc. 962 F.3d 154 (4th Circ. 2020) (Fraud involving programs to improve broadband connectivity in rural communities.)
- United States ex rel. Lamers v. City of Green Bay, 168 F.3d 1013 (7th Cir. 1999) (public transportation grant fraud)
- United States v. C. Abbonizio Contractors, Inc., No. 1:20-cv-06573-NLH-AMD (D.N.J.) (Disadvantage Business Enterprise pass-through fraud on Federal highway project)
- United States ex rel. Magee v. Lockheed Martin Corp., No. 1:09CV324-HSO-JMR (S.D. Miss.) (Government obtained in excess of $24 million settlement in case involving bid collusion)
- United States ex rel. Davis v. M/G Transport Services, Inc., No. C-1-92-1001 (S.D. Ohio) (Government obtained $4.6 million settlement related to tow boats polluting Ohio River in violation of the Clean Water Act while delivering coal to TVA power plants)
- Concept Schools, NFP, November 3, 2020 (Government obtained $4.5 million settlement by a charter school management company for bid rigging related to technology vendors in the E-Rate program)
Whistleblowers under the False Claims Act have served as watchdogs protecting the United States treasury and the taxpayers who fund it since the Civil War. Their vigilance will be all the more critical to protecting the massive amount of infrastructure spending authorized by this new bill.
If you are aware of fraud impacting any of the programs by this new $1.2 trillion infrastructure bill, please contact a lawyer who is knowledgeable about the False Claims Act to discuss it.