The False Claims Act, 31 U.S.C. 3729 et seq., sometimes called the qui tam law, is a major fraud recovery vehicle for the federal government. The FCA was enacted during the Civil War, when the Union confronted the twin dilemma of an unprecedented level of fraud being committed by unscrupulous elements within the newly born military-industrial complex, and a simultaneous lack of investigational resources to bring the wrongdoers to justice. The FCA was designed to cut to the heart of this dilemma by creating a framework within which individuals who reported false claims against the government, or “whistleblowers,” could win a piece of the pie ultimately recovered by the government against contractors found to have submitted fraudulent claims for payment.
The main portions of the FCA were left unchanged for more than a century, with statutory enforcement predominantly in the hands of the U.S. Department of Justice (DOJ). In 1986, sweeping amendments were enacted, as laconically stated in the legislative history, “to make the statute a more useful tool against fraud in modern times.” S. Rep. No. 99-345, at 2 (1986). Among other changes, Congress erected a shared enforcement mechanism permitting whistleblowers — known as “relators” — to bring civil actions themselves, on behalf of the government, against allegedly miscreant government contractors. The 1986 amendments dramatically expanded the FCA’s scope, revolutionized the statute’s revenue-recovery potential and spawned new relators’ and qui tam defense bars specializing in the nuances of complex litigation under the “modern” FCA.
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