On August 16, 2010, New York Governor David A. Paterson signed into law legislation strengthening New York’s False Claims Act. The New York False Claims Act allows individuals to bring civil actions (“qui tam”) on behalf of the state to recover fraudulent payments and overpayments made to third-party suppliers of goods and services.
Last Friday, Nelnet announced that it would pay $55 million to settle a False Claims Act suit alleging that the company defrauded the federal government by improperly benefiting from a student loan subsidy program. The suit, brought by Jon Oberg, alleged that Nelnet exploited a loophole in federal law that allowed Nelnet to guarantee that it would receive 9.5% interest on student loans offered by the company and subsidized by the government.
Late last month, a federal court in Virginia ruled that the government may proceed with a False Claims Act suit against a juvenile psychiatric facility run by subsidiaries of Universal Health Services, Inc. The suit alleges that the Marion Youth Center, a treatment center for adolescent boys, submitted false claims to Medicaid.
Last week, the United States Department of Justice announced that it would intervene in a False Claims Act suit against St. Jude Medical, Inc., alleging that the manufacturer of pacemakers and other heart devices participated in an illegal kickback scheme resulting in the submission of false claims for reimbursement to the government.
A report recently released by the Government Accountability Office (Congress’ investigational arm) found that recruiters at for-profit colleges in the United States lied to entice students to apply and encouraged them to commit fraud to qualify for government-backed financial aid. The GAO report found that recruiters at all 15 colleges studied misled students about the costs and quality of their programs of study,
On August 3, 2010, Panalpina Inc., one of the world’s leading forwarding and logistics services, agreed to settle a False Claims Act suit filed several years ago by a whistleblower on behalf of the U.S. government. The suit alleged that a former Panalpina employee provided unlawful entertainment to employees of Kellogg,
Last week, Tenet Healthcare acknowledged, in a regulatory filing, that the United States Department of Justice is investigating whether one of Tenet’s hospitals fraudulently billed Medicare for heart defibrillator implant surgeries. The D.O.J. probe dates to March 2010, when it issued a demand to Tenet under the False Claims Act seeking information and patient records detailing Tenet’s submissions for implantable heart defibrillator procedures as far back as 2002.
On August 2, 2010, Hewlett-Packard announced that it reached an agreement in principle with the United States Department of Justice to settle both an ongoing government investigation and two False Claims Act suits related to allegations that HP, Accenture, and Sun Microsystems paid millions of dollars in unlawful kickbacks to secure government technology contracts.
The Center for Diagnostic Imaging (“CDI”), one of the nation’s largest providers of diagnostic imaging services for doctors and hospitals, recently agreed to pay at least $1.2 million to settle an allegation of Medicaid billing fraud. CDI’s decision to settle followed on the heels of the federal government’s announcement last week that it intended to intervene and pursue the billing fraud issue on behalf of whistleblowers Dr.
Wilfred Van Gorp, widely known for his declaration that Oddfather Vincent (Chin) Gigante was truly crazy, a claim later soundly rejected based on recorded telephone conversations, was found by a Manhattan federal jury, along with Cornell University, to have violated the federal False Claims Act. According to the claims of the suit,
If you are aware of any person, corporation or entity that you think may be violating the Federal False Claims Act or a State False Claims Act, contact us today.