Don’t Allow Companies To Buy Their Way Out of Fraud Investigations Today


For many, today is the day to exercise their right to participate in a representative democracy established more than 200 years ago by the founders of the United States of America. For others, it is the time to change a political climate hostile to their business and put a friendlier face in office in case their corporation needs a political ally in the future.

Today’s midterm election has been the most expensive in U.S. history. A non-partisan group tracking political spending has projected $4 billion in spending by politicians and interest groups. Approximately 25% of the money spent, or roughly $1 billion, came from interest groups not formally tied to a party or candidate.

What did their $1 billion buy? At best, the opportunity to promote a candidate with a more favorable platform to a win at the election. At worst, they urged Americans to vote for a sympathetic ear to their cause gained through past political donations or other connections.

Corporations have been using using their money and connections to attempt to influence elections for years. As a New York Times op-ed last week pointed out, the SEC does not even require companies to disclose to shareholders their political spending. The fact that many of the organizations they donate to are created for the sole purpose of supporting the election of candidates with particular beliefs and obfuscate the identity of supporters poses additional concerns.

Even Christian pastors are stepping into the game, flouting IRS rules requiring tax-exempt 501(c)(3) organizations to steer clear of endorsing or funding political candidates. Instead, thousands are now endorsing candidates in Sunday sermons to help elect politicians who will create rules that support their beliefs.

Improper influence is not limited to elections, either. Last week, the New York Times had an extensive article about corporate lobbying of State Attorneys General in order to avoid litigation or minimize the cost of settling charges of misconduct.

This is an issue that hits home here. We are frequently called on to convince state attorneys in the 29 states with a version of the False Claims Act to take the information our clients give them and use their resources to prosecute the company. Their decision to intervene should be based on the quality of the information provided, the merits of the legal arguments and the resources required of the state. It should not be a political decision dependent on the quality of the corporation’s lobbying efforts.

Lobbying is not limited to the states, unfortunately. Healthcare companies, the industry most targeted by the False Claims Act in the past ten years, have spent millions lobbying the Senate and House for regulatory approvals and favorable CMS reimbursements. According to Modern Healthcare, which tracks healthcare lobbying, organizations representing health professionals spent $85 million on lobbying last year alone.

Although we recognize that many individuals are dedicated public servants who work hard to protect their citizens, the anecdotal evidence is still alarming. The power of elected officials to exercise their discretion or change the rules of the game in order to help their friends and contacts is too great.

If an individual stands for issues that you care about, then by all means vote for them in the election today. But do not be swayed by the marketing machine of corporations that spend their money to ensure career politicians will help them avoid the consequences of their actions when they are later caught breaking the law.