Yesterday, the Department of Justice (DOJ) released its annual False Claims Act (FCA) recovery statistics, which revealed that Fiscal Year 2016 has been another lucrative year for FCA enforcement. Based on these statistics, DOJ recovered more than $4.7 billion in civil FCA settlements this fiscal year — the third highest annual recovery since the Act was established. Since 2009 alone, the government has recovered $31.3 billion in FCA settlements and judgments. This is a truly staggering statistic. It shows that the government’s reliance on the FCA to combat fraud will continue for the foreseeable future.
The healthcare and financial industries represent the largest portions of this year’s FCA recoveries. In the healthcare industry alone, DOJ recovered a total of $2.5 billion based on federal enforcements. DOJ also touted its instrumental role in assisting states recovering funds overpaid under state Medicaid programs. From the financial industry, the government collected another $1.7 billion, largely as a result of enforcement actions arising from alleged false claims in connection with federally insured residential mortgages.
The number of new FCA matters through both qui tam and non-qui tam actions has increased since last year. Interestingly, however, the statistics indicate that the share of settlements and judgments for relators declined—the percentage of the total recoveries from qui tam suits decreased from 80.7% in 2015 to 61% in 2016. Most significantly, the percentage of recoveries for cases where the government declined to intervene decreased from 31% to 2.2% since last year. Although the cause for this decline is uncertain, one could argue that this indicates that DOJ views the assistance of relators as less valuable in recent years.
Notwithstanding the specific observations related to the industries and types of actions resulting in recoveries this fiscal year, the statistics demonstrate that the FCA remains a powerful tool for the government’s fraud deterrence efforts.