The statutory penalties for each false claim or false statement will nearly double as the U.S. Government adjusts the False Claims Act fines for inflation. Under the Civil Monetary Penalties Inflation Adjustment pursuant to the provisions of the Bipartisan Budget Act of 2015, the new minimum fine for each violation of the FCA will be $10,781, with a maximum of $21,563.
The current minimum is $5,500 and the maximum is $11,000, according to 28 C.F.R. 85.3(a)(9). The new penalties will go into effect on August 1, 2016.
The current inflation adjustments will apply to violations on or before November 2, 2015, as well as to assessment before August 1, 2016 when the violation occurred after November 2, 2015. In other words, the statutory fines of $5,500 and $11,000 will continue to apply under the rule to conduct on or before the adoption of the Bipartisan Budget Act of 2015.
Defendants will be subject to the treble damages provision without change. This is one of the most powerful aspects of the law in the fight against government fraud.
The release of the interim final rule with request for comments included updates to the penalties of other laws that are familiar to whistleblower lawyers, including the Anti-Kickback Act and the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA).
For additional information about the changes, please contact one of our False Claims Act attorneys.