Whistleblowers had tremendous victories in 2023—and their numbers are rising
Last year in Fraud by the Numbers, we began our look at the 2022 U.S. Department of Justice (DOJ) annual statistics on settlements and judgments under the False Claims Act by observing that the government has been recovering less money through qui tam actions than it did several years ago. This year, we are pleased to observe that the amount of money recovered through qui tam actions has been rising from its low point in the 2020-2021 pandemic years. Qui tam recoveries increased from $1.99 billion in fiscal year 2022 to $2.33 billion in fiscal year 2023:
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As always, most of the money that the government recovered through whistleblower actions was healthcare-related. However, the increase in total qui tam recoveries from 2022 was not explained by healthcare recoveries, which decreased slightly from $1.68 billion in 2022 to $1.577 billion in 2023.
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Instead, the increase in total recoveries was caused by Department of Defense related cases. The government’s $377 million recovery in Sarah Feinberg’s case against Booz Allen Hamilton was by far the largest defense-related FCA recovery of the past decade, and lead to Ms. Feinberg receiving TAF Coalition’s 2023 Whistleblower of the Year award. In addition, defense related whistleblower cases where the government declined to intervene, and the whistleblower chose to litigate the case on their own, contributed another $112 million. In total, defense-related FCA whistleblower recoveries rose to $501 million in 2023, the highest they have ever been:
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We noted last year that the government’s recoveries under the False Claims Act have dramatically decreased relative to the amount of total federal spending, which is particularly troubling due to the massive increase in spending that occurred during the pandemic years. The government’s recoveries under the False Claims Act continue to be a much smaller share of total federal spending, but the percentage did rise last year. We hope this trend continues.
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To continue this trend, the government should take advantage of the rising number of new whistleblower actions filed in federal court. In fiscal year 2023, 712 new qui tam actions were filed, the highest number since 2014.
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With more and more whistleblowers coming forward and the examples of tremendous individual victories against fraudsters in 2023, we look forward to the Department of Justice continuing its forward momentum into the next Administration using the strong public-private partnership of the False Claims Act to fight fraud.
Nicolas Mendoza is a Senior Associate at Murphy Anderson