Such cases were brought under the
False Claims Act, a law covering frauds against the government that includes a provision allowing
private citizens to file lawsuits on the government’s behalf. These citizens are then
entitled to collect a portion of any fines or penalties collected in their cases.
Overall, the government recovered nearly $5
billion in False Claims Act cases for the fiscal year ended Sept. 30, including $3 billion stemming
from health care fraud and $911 million paid by mortgage servicers as part of the $26 billion
foreclosure settlement, the Justice Department said.
The previous record for False Claims Act recoveries was $3.2
billion in the prior fiscal year.
“The False Claims Act is, quite simply, the most powerful tool that we have to deter
and redress fraud,” Acting Associate Attorney General Tony West said.
The biggest single case for 2012 involved
pharmaceutical firm GlaxoSmithKline (GLAXF), which paid $1.5 billion to resolve False Claims
Act allegations. The company was accused of promoting drugs for uses other than those approved
by the Food and Drug Administration, making false statements about drug safety and underpaying
Medicaid rebates. The $1.5 billion payment came as part of a $3 billion
settlement concerning the drug maker’s practices.
In the GlaxoSmithKline case, “multiple” whistleblowers received
awards totaling $131 million, the Justice Department said. In the foreclosure
settlement, six whistleblowers received
$46.5 million in total.
Overall, whistleblowers received $439 million in Justice Department cases in the 2012
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