In an effort to safeguard public funds and promote accountability, the State of New Jersey enacted the New Jersey False Claims Act (“NJFCA” or the “Act”). This legislation empowers whistleblowers to bring forth claims on behalf of the government when they suspect fraudulent activities. With a robust legal framework, the NJFCA serves as a crucial tool in the fight against fraud. In addition, the Act provides a means to uncover and prosecute deceptive practices that defraud taxpayers.
The legislature passed the NJFCA in 2008. It closely mirrors the federal False Claims Act. The NJFCA encourages individuals with knowledge of fraud against the government to come forward by providing protection and incentives.
Therefore, if you “blow the whistle” on an employer for defrauding the State, you could not only save taxpayer money, but you could also be rewarded for your good deed.
Under the NJFCA, individuals, known as whistleblowers or relators, can sue, known as a qui tam action, on behalf of the government. If successful, whistleblowers may receive a percentage of the recovered funds, serving as an incentive to expose fraudulent practices. The Act imposes penalties on individuals and entities found guilty of making false claims or statements, including treble damages and civil fines.
The NJFCA lays out several fraudulent acts that may lead to a cause of action. Each requires committing an act “knowingly” or “knowing” something. For the purposes of the law, under N.J.S.A. § 2A:32C-2, this means actual knowledge, acting in “deliberate ignorance of the truth or falsity of the information,” or acting in “reckless disregard.”
The acts, in N.J.S.A. § 2A:32C-3, include:
- Knowingly presenting or causing to be presented a false claim for payment or approval to the state or any contractor or recipient of state funds;
- Knowingly making, using or causing to be used or made a false statement or record to present for a false claim from the state;
- Conspiring to defraud the state through false claims;
- Having possession, custody or control of property of the state and knowingly delivering less than the amount on the receipt or certificate;
- When authorized to make a document certifying property used or to be used by the state, making or delivering the receipt without completely knowing the information is true with the intent to defraud;
- Knowingly buying or receiving, as a pledge toward an obligation or debt, state property from a person not authorized to sell it; and
- Knowingly using or making a false record to conceal, avoid or decrease an obligation to pay money or transmit property to the state.
Suing Under NJFCA
If your employer commits any of these acts, you may sue. The court seals the lawsuit for 60 days, and it is not served on the defendant. When the suit is filed, you must also notify the New Jersey State Office of the Attorney General. The State attorney will decide whether to intervene.
If the employer is found to have defrauded the government, it is liable for up to three times the amount of damages it caused the State to incur. However, if the employer furnishes the State with information within 30 days and fully cooperates with the investigation, the damages may be reduced to twice as much.
If the Attorney General intervenes, you may continue involvement with the suit and earn 15 to 25 percent of those damages. If the Attorney General does not intervene, you may earn up to 30 percent.
Specific Acts of Fraud Under the New Jersey False Claims Act
Medicaid and Healthcare Fraud: One of the most common types of fraud under the Act is healthcare fraud, particularly in relation to Medicaid. Examples of fraudulent activities may include billing for services not rendered, upcoding (charging for more expensive procedures or services than provided), kickbacks, and misrepresentation of patient eligibility. Whistleblowers can play a crucial role in exposing such fraudulent practices and ensuring the integrity of healthcare programs.
Government Contracts Fraud: Fraudulent activities related to government contracts are another significant area covered by the NJFCA. Contractors may engage in bid-rigging, collusion, or submission of false claims for payment. Additionally, providing defective or substandard goods and services, overbilling, or failing to adhere to contract terms can also constitute fraud. The FCA empowers whistleblowers to bring such actions to light, preserving the integrity of government contracts and protecting taxpayers’ interests.
Tax Fraud: The NJFCA covers tax fraud as well. Individuals or businesses who engage in tax evasion, under reporting income, inflating deductions, or engaging in other fraudulent practices to evade taxes can be held accountable under the Act. Whistleblowers with knowledge of such tax fraud can assist authorities in identifying noncompliant taxpayers, ensuring fairness and equity in the tax system.
Education Fraud: Education-related fraud, particularly in state-funded programs, is another area covered by the NJFCA. False claims made by educational institutions or individuals in relation to student financial aid, grants, or loan programs can be brought to light by whistleblowers. Examples include misrepresentation of student eligibility, falsification of academic records, or receipt of improper or excessive financial aid funds.
The New Jersey False Claims Act serves as a powerful deterrent against fraud and deceptive practices that harm taxpayers and erode public trust. By allowing whistleblowers to provide information and offering financial incentives, the Act encourages the exposure of fraudulent activities that may otherwise go unnoticed.
Specific acts of fraud, such as healthcare fraud, government contracts fraud, tax fraud, and education fraud, can form the basis for claims under the Act. With the help of experienced New Jersey False Claim Act attorneys, whistleblowers, through the NJFCA, reinforce accountability, safeguard public funds, and ensure a fair and transparent government for the citizens of New Jersey.
Assisting New Jersey Whistleblowers with NJFCA Claims
The New Jersey False Claim Act and employment lawyers at Schiller, Pittenger and Galvin, P.C., are experienced with filing claims under the New Jersey False Claims Act, saving taxpayer money and rewarding workers who shine the light on fraud and waste. If you are aware of wrongful conduct occurring at your New Jersey employer, resulting in fraud upon the New Jersey state government, call us today at our Scotch Plains office at 908-490-0444 to set up a consultation. You can also email us here.