Last week marked the 25th anniversary of the 1986 amendments to the False Claims Act. While it may seem strange to celebrate amendments to an Act that dates back to the Civil War, these amendments were instrumental in giving the False Claims Act the power it has today to combat fraud and demand accountability of those who try to take advantage of the U.S. government.
The False Claims Act itself is almost 150 years old, dating back to the Lincoln Administration. As Attorney General Eric Holder noted when he spoke at the recent celebration in Washington, D.C., President Abraham Lincoln predicted that the False Claims Act “would be instrumental in preventing unscrupulous companies from reaping enormous profits at the expense of the Union Army.”
From the Civil War until World War II, the False Claims Act was a powerful tool for fighting fraud against the U.S. government. However, during World War II, changes were made that caused the False Claims Act to become considerably less effective. The False Claims Act had lost its teeth, but government contracts were still being awarded, and the government needed to be protected from unscrupulous contractors who would take advantage.
Then, in the mid-1980s, a group of policymakers decided to take action to protect our government resources by making the False Claims Act more effective and reclaiming the Act’s original intent. Amendments such as new protections and incentives for whistleblowers, a longer statute of limitations, and the potential for treble damages for the government all gave new life and power to “Lincoln’s Law.”
Since the 1986 Amendments went into effect, whistleblowers have had a tremendous impact in fighting fraud against the government. As Attorney General Holder acknowledged, in the last 25 years, more than $30 billion has been recovered by the U.S. government under the False Claims Act. Over the last 3 years alone, the U.S. government recovered $8.8 billion in damages under the False Claims Act, much of it thanks to the actions of whistleblowers who knew of fraud against the government and stepped forward to challenge it.
The False Claims Act enables one person to stand up to fraudulent activity against the government and so protect the interests of all taxpayers, and as Attorney General Holder acknowledged, the need for vigilant individuals to step forward has never been greater than it is today.