THE NEW YORK FALSE CLAIMS ACT
QUESTIONS & ANSWERS
The New York False Claims Act is a law which empowers people with evidence of fraud against the State, or any City within the State, to file a complaint to recover triple the amount which has been defrauded from the Government, and to receive a monetary reward for doing so.
The law applies to cases where someone has committed a fraud against:
(a) The State of New York or any political subdivision of the State, or
(b) any County, City, Town, Village, or School District within the State of New York, or
(c) any Municipal Corporation or Public Benefit Corporation, including the MTA and the LIRR.
As compensation for their efforts, a person who files such a complaint, (known as the “Relator”) can receive a monetary award, typically between 15% and 30% percent of the total amounts recovered by, or for, the Government.
The term “qui tam” stands for a longer Latin phrase [qui tam pro domino rege quam pro se ipso in hac parte sequiter] that is translated as “he who brings an action for the king as well as for himself.” Qui tam is the technical legal term for the legal principal which allows individuals who have evidence of fraud to sue the wrongdoer on behalf of the Government.
Virtually any situation within which the State or City Government is dispensing money, or collecting money, can give rise to a False Claims Act violation.
Activities which constitute a violation under the False Claims Act are:
(a) knowingly presenting, or causing to be presented, a false claim for payment or approval by an agent or employee of the Government;
(b) knowingly making, using, or causing to be made or used, a false record or statement to get a false claim paid or approved by the Government;
(c) conspiring with others to get a false or fraudulent claim allowed or paid by the Government;
(d) having possession, custody or control of property or money used, or to be used, directly or indirectly, by the Government and, intending to defraud the Government or willfully conceal the property or money, delivers or causes to be delivered, less property or money than the amount for which the person receives a certificate or receipt;
(e) while being authorized to make or deliver a document certifying receipt of property used, or to be used, directly or indirectly by the Government, and intending to defraud the Government, makes or delivers the receipt without completely knowing that the information on the receipt is true;
(f) knowingly buying, or receiving as a pledge of an obligation or debt, public property from an officer or employee of the Government, knowing that such officer or employee lawfully may not sell or pledge the property;
(g) knowingly making, using, or causing to be made or used, a false record or statement to conceal, avoid or decrease, directly or indirectly, an obligation to pay or transmit money or property to the Government.
In short, it is only the filing of a qui tam lawsuit and subsequent settlement or favorable judgment which enable a private party to receive a recovery under The False Claims Act.
There is no limit upon the actual dollar amount which can be awarded to a relator.
The highest reward paid under the Federal False Claims Act, upon which the New York False Claims Act was modeled, was over one hundred fifty million dollars ($150,000,000.00).
The person who files the complaint, known as the “relator”, typically receives between 15% and 30% of the total recovery from the defendant, whether through a favorable judgment or settlement.
If a person brings a qui tam action, and the Government chooses to intervene by taking over the lawsuit, the relator generally is eligible to receive between 15% and 25% of the recovery.
If a person brings a qui tam action, and the Government chooses not to intervene, the relator can proceed without the government and can receive between 25% and 30% of the recovery.
Violators of the False Claims Act are liable for three (3) times the amount of damages the Government sustained as a result of the fraud, plus civil penalties between $6,000 and $12,000 for each violation.
Virtually anyone who receives money from the Government, pays money to the Government, or helps someone else get money from the Government, can engage in conduct which would make them liable for a violation of the False Claims Act.
Common examples of defendants in qui tam actions, include the following:
Individuals and Businesses: Virtually any individual or business who does business with the Government, sells something to the Government, or any agency or branch thereof, can be a defendant in a complaint under the False Claims Act.
Government Contractors and Subcontractors: Anyone who contracts to provide services or goods to the Government can be a defendant for a vast array of complaints.
Under the False Claims Act, a complaint must be filed within the later of two time periods:
(a) Within six years from the date of the violation of the Act, or
(b) Within three years after the Government learned, or should have learned about the violation, but in no event later than ten years after the violation of the Act.
Please Note - if, before you file, someone else files a False Claims Act complaint or helps publicize allegations similar to yours, you may lose your right to file a complaint.
If you choose to retain the services of Campanelli & Associates, P.C., and we agree to take your case, we will represent you on a contingency fee basis.
This means that you pay no out-of-pocket legal fees.
We get paid if, and only if, your claim results in a monetary award or settlement, from which we get a percentage for our fees.
The time from the filing of a complaint until its resolution can vary greatly from case to case, and can range from months to years.
As a general rule, you do not give up your right to file a complaint by going to the Government before filing your complaint.
However, no person can file a complaint to expose allegations which are already the subject of any pending criminal or civil action or proceeding, or any administrative action within which the Government is already a party.
It is possible, but unlikely, that you will be able to keep your identity a secret if you file a complaint under the Act.
Yes. Under the False Claims Act, any employee who is discharged, demoted, harassed or otherwise discriminated against because of lawful acts of the employee in furtherance of an action under the Act is entitled to receive all relief necessary to make the employee whole.
Such relief may include reinstatement with full benefits and seniority, double back pay plus interest, plus additional compensation for any special damages including litigation costs and attorneys fees.
No. There is a separate Federal False Claims Act which covers frauds against the Federal Government. To learn about exposing fraud against the Federal Government go to FederalFraud.com, or call Campanelli & Associates, P.C. at (516) 746-1600
To obtain more information, contact:
Andrew J. Campanelli
For information about actual cases, go to the NEWS section of this web site.