In 2009, Governor Beverly Perdue signed in to law the North Carolina False Claims Act. Like the federal False Claims Act, the North Carolina False Claims Act allows private individuals to file a lawsuit, called qui tam claim, on behalf of the State of North Carolina. The qui tam lawsuit is filed against a person(s) or business for submitting or causing the submission of false claims to the state, or becoming aware of mistakenly submitted claims and failing to submit repayment.
North Carolina False Claims Act Specifics
The North Carolina False Claims Act–N.C.G.S §§1-605 through 617 states that any party shall be liable to the State for up to three times the amount of damages that the State sustains from any person who:
- Knowingly presents or causes to be presented a false or fraudulent claim for payment or approval.
- Knowingly makes, uses, or causes to be made or used, a false record or statement material to a false or fraudulent claim.
- Conspires to commit a violation of subdivision
- Has possession, custody, or control of property or money used or to be used by the State and knowingly delivers or causes to be delivered less than all of that money or property.
- Is authorized to make or deliver a document certifying receipt of property used or to be used by the State and, intending to defraud the State, makes or delivers the receipt without completely knowing that the information on the receipt is true.
- Knowingly buys, or receives as a pledge of an obligation or debt, public property from any officer or employee of the State who lawfully may not sell or pledge the property.
- Knowingly makes, uses, or causes to be made or used, a false record or statement material to an obligation to pay or transmit money or property to the State, or knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the State.
Any party who commits any of the following acts shall also be liable to the State for the costs of a civil action and shall be liable to the State for a civil penalty up to $11,000 per violation in addition to three times the amount of damages sustained by the state due to that party.
Whistleblower Rewards & Protection
The North Carolina legislature recognized that most fraud against the state goes unreported. That is why the North Carolina False Claims Act rewards whistleblowers by allowing a whistleblower to receive a percentage of any recovery. Damages for violating the North Carolina False Claims Act may include treble damages and significant fines. If the North Carolina Attorney General intervenes in the claim, the whistleblower my receive up to 25% of the any recovery.
The North Carolina False Claims Act also provides whistleblower protection against workplace retaliation by employers. It is well recognized that most individuals who become aware of fraudulent schemes are inside employees of a business. The NC FCA prohibits retaliation by employers, which may include loss of pay, demotion, suspension, firing, harassment, threats, as well other retaliations.
If liable under the North Carolina False Claims Act, an individual or business that has retaliated against an employee may be required to pay two times the amount of back pay, interest, monetary damages for discrimination, costs and attorney fees.
Bringing an action under the North Carolina False Claims Act, means filing a lawsuit under seal, or in secret. The State of North Carolina then has 120 days to decide whether to intervene before the case is unsealed. Often, the State petitions the court to grant an extension of time to increase the amount of time the case is under seal.
Recent North Carolina False Claim Cases:
EmCare, Inc. to Pay $29.8 Million To Resolve False Claims Act Allegations: December 19, 2017 the U.S Attorney’s Office for the Western District of North Carolina, announced that a Emcare agreed to pay $29.8 million for causes medically unnecessary admissions of Medicare beneficiaries.
Carolina Healthcare System Agrees to Pay $6.5 Million To Settle False Claims Act Allegations: June 30, 2017 Carolina Healthcare Systems agreed to pay $6.5 million for “up coding” claims for urine drug tests to receive higher Medicaid payments.
Whistleblower Attorney In Raleigh, NC
Stacy Miller, II, at Miller Law Group, has extensive experience representing North Carolina whistleblowers in False Claim Act cases. His practice includes Healthcare Fraud, Government or Defense Contractor Fraud, Securities Fraud, IRS Fraud, Commodities Fraud, and other fraud against the government.