Too Many False Claims Act Cases?

A common refrain we hear from opponents of the False Claims Act (FCA) is that there are just too many FCA lawsuits, and that whistleblowers are running around filing frivolous suits just to vex defendants. However, a look at the numbers shows how far from true that is.

Qui tam relators and their counsel only get paid if their cases are successful, so it should be obvious that they are not incentivized to file frivolous cases and risk the financial and personal consequences of blowing the whistle. The numbers reflect that restraint. In 2022, there were 309,102 civil cases filed in district courts around the country, which was a steep drop from 2021 – a 33% drop in fact, after rising 39% in 2021. This is due to the more than 190,000 Multi-District Litigation cases addressing 3M Combat Arms earplugs had been filed in the Northern District of Florida in 2021 – so the number of civil cases filed stabilized some last year. The number of cases in which the government was a plaintiff dropped by 13%.

Of the 309,102 new civil cases filed in the U.S., only 652 were qui tam actions. While this is slightly more cases filed than in 2021, it is still only 0.21% of the total civil cases filed. This is in a year where the federal budget was $6.27 TRILLION. The Government Accountability Office estimates that between $100 and $130 billion was lost to fraud between 2020 and 2023 solely in the Unemployment Insurance program, and another $80 billion from the Paycheck Protection Program. At least $100 billion is likely lost to Medicare and Medicaid fraud each year. However, as was discussed earlier this month, only about $2.2 billion was recovered as a result of FCA cases last year.

There is enormous opportunity for whistleblowers to assist the government in recovering many more billions lost to fraud each year.

Jacklyn DeMar is the Director of Legal Education at The Anti-Fraud Coalition