The Law Firm of Piacentile, Stefanowski & Malherbe LLP

A Brief History of Significant Changes to the False Claims Act

The False Claims Act (FCA) is a federal law that allows whistleblowers to sue companies that have defrauded the government. The FCA has been around since 1863, but it was not until the 1980s that it began to be used to its full potential. This is thanks in part to amendments made in 1986, which increased fines for false claims and rewards for whistleblowers. Since then, the FCA has become one of the most powerful weapons in the government's arsenal against fraud and corruption.


The 1986 amendments to the False Claims Act have had a profound impact on the fight against government contractor abuse. Whistleblowers are now coming forward with information about fraud and corruption, and the government is able to recover millions of dollars that would otherwise have been lost to fraudulent activity. If you suspect that a company is defrauding the government, don't hesitate to contact a qualified attorney to discuss your rights and options under the False Claims Act.


The law was amended in 1943, and the changes weakened whistleblowing. The 1943 amendment removed the qui tam provision's efficacy. Whistleblower awards become nearly impossible to get. In addition, the amendment increased the burden of proof for whistleblowers, making it more difficult to prove fraud. As a result of these changes, the number of False Claims Act lawsuits filed fell sharply. In 1986, Congress responded to public outcry over rampant fraud in the nuclear and defense industries by restoring the qui tam provision and revising the burden of proof. These changes have helped to encourage more whistleblowers to come forward and report fraud.


In 2009 and 2010, the False Claims Act was amended again in order to give more protection to whistleblowers and to make it easier for whistleblowers to prevail in qui tam actions. It was amended in order to close some loopholes that had been exploited by defendants and to clarify the law in certain areas.  The changes also expanded the types of claims that could be brought under the Act, making it easier for the government to recover damages from those who defraud taxpayer-funded programs. As a result of these changes, the False Claims Act has become an increasingly powerful tool for fighting fraud and protecting whistleblowers.


In addition to recent amendments to the FCA by Congress, in recent years, the Supreme Court has issued several opinions that have interpreted the scope of the False Claims Act. In US ex rel. Escobar v. Universal Health Services, Inc., the Court held that the Act applies to implied false claims, as well as express false claims. The Court also ruled that plaintiffs must prove that the defendant’s misrepresentation was material to the government’s decision to pay the claim.

The FCA has been successful in deterring fraud and abuse by government contractors, but there is always room for improvement. For example, some have suggested increasing the reward percentage for whistleblowers, which could incentivize even more people to come forward with information about fraud and corruption. Whatever the future holds for the False Claims Act, one thing is certain: it will continue to play a vital role in protecting taxpayer dollars and holding government contractors accountable for their actions.


If you have information about a company that is defrauding the government, you may be eligible for a whistleblower reward. Contact us at Whistleblowers International to learn more about your rights and options under the False Claims Act.