FERA Is Example of Commitment to Protect Funds

In an attempt to ensure the government can recover taxpayer dollars lost to fraud and abuse, the recently approved Fraud Enforcement and Recovery Act of 2009 (“FERA”) expands the grounds for liability under the False Claims Act (“FCA”).

Signed into law by President Obama on May 20th, 2009, the principal objective of FERA is to expand the reach of federal law and increase funding for federal agencies to combat the types of financial frauds that contributed to the current subprime and economic crisis, and to recover taxpayers’ money lost to these frauds.

The FCA was amended by FERA, in part, due to court decisions that undermined the intended scope of the FCA. Specifically, FERA amends the FCA by extending the FCA to a wider range of transactions; reducing the intent required to establish liability; permits non-employees to bring retaliation claims; broadens the reverse false claims provision; and facilitates greater showing of investigation materials by the Department of Justice.

Since a substantial portion of the funds expended in an effort to stabilize our economy are being dispensed through a variety of government contracts and grants, FERA’s FCA amendments are directed, in part, at protecting these funds. Congress has shown a commitment to reverse the current economic crisis and prevent, through the various stimulus programs, a repeat of this crisis in the future. FERA is another example of this commitment.