The Social Cost of Cheating the Government
Each year, private corporations, known as government vendors, receive contracts worth over $450 billion. Because of bribery and kickbacks, taxpayers are often left with the burden of overpaying for inefficient government contracts, such as the infamous instance of $7,600 coffee makers and $435 hammers sold to the U.S. Navy. Some cases of procurement fraud have had deadly consequences, such as in cases of defense contractors where soldiers receive defective weapons or inefficient body armor.
It is estimated that these unlawful scams account for up to 6% of all federal money spent on private contracts, costing American taxpayers as much as $42 billion every year. Thanks to efforts of many brave whistleblowers over the past five years, False Claims Act cases of this type have recovered over $4 billion for the U.S. Treasury, with settlements totaling $1.1 billion in 2015 alone.