150th Anniversary of the False Claims Act

Author: B. Nathaniel Garrett, Editor-in-Chief, University of Cincinnati Law Review

President Abraham Lincoln signed the False Claims Act (FCA) into law 150 years ago on March 2, 1863, giving the United States a tool to combat fraud committed against the government.  At the time, it was mostly Civil War defense contractors perpetrating fraud against the government.  As initially enacted, the statute included double damages and a $2,000 per false claim penalty.

Much has changed in the past 150 years; the statute has been amended several times since its enactment, but two amendments hold great significance.  The 1943 amendments effectively ended FCA cases by substantially weakening the qui tam provision of the Act by including the “any government knowledge” bar.  After this amendment, the statute lay dormant for a number of years.  When Congress and President Reagan faced issues of procurement fraud and government waste in the 1980s, they again looked to the FCA for assistance, but they needed to strengthen the Act.  The 1986 amendments were passed, removing the “any government knowledge” bar and substantially strengthening the qui tam provision.

Since 1986, the FCA has recovered over $6 billion, returning significant amounts of money to the U.S. Treasury.  Human nature being what it is, fraud is likely here to stay.  With vigilance and a respect for the effectiveness of the Act, hopefully the FCA will also be here to stay.

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