Obama Signs Expansive New Fraud-Busting Bill

President Obama today signed into law the Fraud Enforcement and Recovery Act of 2009 (FERA), a bill that extensively ramps up anti-fraud measures, including authorizing new funding to fight fraud, adding protections to federal whistle-blowers and expanding the power of the False Claims Act (FCA).

One of the biggest changes brought about by the new bill is the reversal of the recent Supreme Court Decision in Allison Engine Co. v. United States. That decision created a loophole in which subcontractors receiving government money would not be liable under the False Claims Act, according to a statement released by the National Whistleblowers Center.

With the new legislation, a company can be charged under the FCA if an employee “knowingly makes a false claim to obtain money or property, any part of which is provided by the Government without regard to whether the wrongdoer deals directly with the Federal Government; with an agent acting on the Government’s behalf; or with a third party contractor, grantee, or other recipient of such money or property.”

Previously, government subcontractors could only be charged under the FCA if they knowingly and intentionally defrauded the government, not the primary contractor.

The bill was first introduced by Senators Patrick Leahy of Vermont and Chuck Grassley of Iowa in February.

If you’re so inclined, you can read the full text of the bill here. Of course, the simplest way to protect yourself and keep this all straight is…just don’t defraud anyone.


One Response to “Obama Signs Expansive New Fraud-Busting Bill”

  1. 1
    Marla Fisher Says:

    Yes we can! Go Ethisphere.org!!! Age of Aquaris. Time to Learn. Time to do life in an ethical way! Thank you Ethishere.org. I support your organization, and I tell others about your organization, all the time! I nominate Ethispere.org for 2010 most Ethical Companies! Please submit.

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