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Justice Department Recovered $107 Million for Procurement Fraud in 2018

Last month, the Department of Justice issued its annual report on recoveries under the False Claims Act (“FCA”) cases during fiscal year 2018. The amount of recoveries for procurement fraud totaled approximately $107 million. However, this amount was only a small portion of the nearly $2.8 billion recovered in 2018 under the FCA, most of which was for healthcare fraud. With respect to procurement fraud, the largest recovery was from Toyobo Co. Ltd. of Japan and its American subsidiary, Toyobo U.S.A. Inc. Toyobo paid $66 million to resolve claims that they sold defective Zylon fiber used in bulletproof vests that the. Read More.

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“Double Down” on False Claims Act Penalties

Attention all contractors! Effective August 1, 2016, the U.S. government adjusted the penalty amounts applicable to civil penalties to include the penalty assessed under the False Claims Act (31 U.S.C. 3729(a)). The new penalty has increased from $11,000 to a maximum penalty of $21,563. Additionally, the penalty is assessed on top of “3 times the amount of damages which the Government sustains because of the act of that person,” unless reduced in court. This increase in penalties is actually a “catch up” by the government. The government has taken the position that to ensure an effective deterrent is maintained, and. Read More.

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