Neil V. Getnick to Testify Before House Subcommittee on FCA

Neil V. Getnick, managing partner of Getnick & Getnick LLP and chairman of Taxpayers Against Fraud, will testify at a hearing before the House Judiciary Committee’s Subcommittee on the Constitution and Civil Justice on Thursday, April 28th regarding “Oversight of the False Claims Act.”  The Judiciary Committee’s press release announced that “[t]he hearing will examine the False Claims Act, which is one of the government’s principal anti-fraud laws that has proven to be effective at recovering taxpayer money lost as a result of fraud against the federal government.”

In his prepared remarks, Getnick lauds “the extraordinary success of the Federal False Claims Act in recovering stolen tax dollars, reforming corrupt practices, and creating an unparalleled public-private partnership to protect the public fisc.”  Getnick cites the massive recoveries, the “twenty-to-one return on investment,” and the Act’s role in “leveling the playing field so that honest companies can compete” as evidence of the Act’s success and importance.

Responding to the subcommittee’s comments that “businesses…are concerned that while the False Claims Act can be effective, it can also lead to unfair penalties and unjust results, particularly for health care companies, non-profits, and small and large businesses,” Getnick notes that safeguards are already built into the False Claims Act.  DOJ possesses–but has rarely had to exercise–the power to dismiss an action it declines; and courts can impose penalties against whistleblowers who file “frivolous” cases.  Getnick also points out that the dynamics of FCA cases also make it unlikely that a lawyer (often paid on a contingency basis) or a whistleblower (whose reputation is at stake) will proceed with a case they can’t win.

Responding to the often-suggested “improvements” to the False Claims Act, Getnick quotes the 2014 statement of the architect of the modern-day FCA, U.S. Senator Charles Grassley:

They talk about a ‘gold-standard compliance certification program,’ but it’s just a pie-in-the-sky idea with no specifics. They are vague on who would create the program, who would enforce the program – basically, everything about it. But they want you to believe that once this pipe dream is in place, it will magically increase the amount of taxpayer dollars the government recovers.

In exchange for this castle in the air … they want to eliminate the use of exclusion or debarment, surrendering one of the government’s strongest tools for deterring fraud. They want to lower the damages multiplier for those who self-report. And they repackage a detrimental proposal to whistleblowers that has been recycled again and again.

Large corporations have long argued that whistleblowers should be forced to report wrongdoing internally before going to the government. Yet when whistleblowers try to do exactly that and get retaliated against, these large corporations change their stance in court and argue that whistleblowers only have protection if they report externally. Those kinds of inconsistent positions make it hard to believe that either argument is made in good faith. . .

The hearing will take place on April 28th at 4:00p.m.  Watch it live here.