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DOJ Enforcement Actions

The Department of Justice is the principal federal agency authorized to enforce the laws and defend the interests of the United States. As such, it oversees the enforcement of the False Claims Act, the foundation of the American whistleblower system, as well as numerous other laws.

The agency traces its origins to the Judiciary Act of 1789 which created the Office of the Attorney General, and the 1870 Act to Establish the Department of Justice, which established the agency as “an executive department of the government of the United States” with the Attorney General as its head.

The agency is comprised of numerous divisions with the Civil Division and in some instances, the Criminal Division, overseeing investigations and prosecutions under the False Claims Act. The U.S. Attorneys Office of the federal district where the False Claims Act case is filed also plays a key role in False Claims Act enforcement.

Below are summaries of recent DOJ settlements or successful resolutions under the False Claims Act as well as other successful prosecutions for fraud and misconduct. If you believe you have information about fraud which could give  rise to a claim for a whistleblower reward, please contact us to speak with one of our experienced whistleblower attorneys.

June 1, 2020

Mississippi Department of Health Services (MDHS) has agreed to pay $5 million to resolve allegations of submitting false quality control data to the USDA’s Supplemental Nutritional Assistance Program (SNAP) in order to receive performance bonuses.  The United States previously settled with five other state agencies, as well as with a consultant involved with all of the cases, Julie Osnes Consulting, LLC.  The settlement with MDHS brings the total amount recovered to $41 million.  DOJ; USAO EDWA

May 27, 2020

A contractor tasked with constructing a new terminal of the Peoria International Airport using FAA grant funds has agreed to pay $1 million to settle allegations that it fraudulently obtained the contract by misrepresenting its use of a disadvantaged small business.  In violation of grant rules as well as the False Claims Act, Williams Brothers Construction Inc. allegedly made false representations and submitted fraudulent documents to make it appear that an eligible firm would do work on the project when instead the work was handed off to an ineligible firm.  DOJ; USAO CDIL

May 22, 2020

The University of San Francisco has agreed to pay $2.5 million to resolve allegations of knowingly presenting false and fraudulent claims in order to obtain federal grants under the AmeriCorps State and National Program to support its San Francisco Teacher Residency Program, which supplements tuition and living expenses for teacher apprentices working within the local school district.  The government’s investigation, triggered by a whistleblower’s qui tam complaint, revealed that over 1,500 timesheets had been falsified and 61 awards had been falsely certified between 2014-2016, netting the university’s program and students over $1.7 million in grants.  USAO CDCA

May 7, 2020

Seattle Pain Center, Northwest Analytics, and owner/physician Dr. Frank Danger Li have agreed to pay $2.85 million to settle allegations of defrauding Washington’s Medicaid program.  An investigation revealed that between 2013 and 2015, Li had instituted a policy required nearly every patient treated at Seattle Pain Center to be administered the full urine drug panel at each visit even if they were not medically necessary.  The drug tests were then sent to Li’s exclusively-owned laboratory to be analyzed.  Additionally, the investigation revealed that between 2007 and 2016, Li wrote an excessive amount of prescriptions for opioids, and at least 60 of his patients died due to opioid-related causes during this period.  AG WA; USAO WDWA

May 6, 2020

The United States has obtained a settlement of $49 million in the 1Malaysia Development Berhad (1MDB) scandal, in which high-level officials of 1MDB and their associates allegedly robbed the people of Malaysia by misappropriating over $4.5 billion in public funds, which they laundered through financial institutions based in the United States and other countries and squandered on expensive properties and possessions.  With the conclusion of the case against Emirati businessman Khadem al-Buraisi, the United States has recovered over $1.1 billion in assets arising from the 1MDB scandal, representing the largest civil forfeiture by the DOJ and the largest recovery to date under the agency’s Kleptocracy Asset Recovery Initiative.  DOJ; USAO CDCA

May 4, 2020

Two New York construction companies and their associates have agreed to pay $4.5 million to resolve allegations of defrauding the U.S. Small Business Administration (SBA) and exploiting federal contracting opportunities reserved for veteran-owned small businesses and small businesses located in historically underutilized business zones (HUBZones).  Northland Associates, Inc., its president James Tyler, The Diverse Construction Group, and bond agent Rose & Kiernan Inc. allegedly failed to disclose and took steps to conceal the extent to which Diverse, which is 51% vetern-owned and 49% owned by senior Northland officials, took direction from Northland.  The government’s investigation was triggered by whistleblower lawsuits; the whistleblowers in this case will receive $1 million of settlement proceeds.  USAO SDNY

May 1, 2020

Milwaukee-based Center for Pain Management, S.C. and its owner, Nosheen Hasan, will pay at least $1.35 million to resolve claims that they received unlawful kickbacks in exchange for ordering medically unnecessary tests from a urine drug testing laboratory, Midwest Laboratory Sales & Consulting, LLC, in violation of the False Claims Act.  The investigation was initiated by a whistleblower, who will receive a share of the settlement.  USAO ED WI

April 30, 2020

Entities of Israeli banking conglomerate Bank Hapoalim have pleaded guilty and entered into civil settlements for their role in a money laundering scheme for bribes made to soccer officials with Fédération Internationale de Football Association (FIFA) and others in exchange for preferences including in the award of soccer match broadcasting rights.  As part of three-year non-prosecution agreement, the bank will forfeit $20.73 million, pay a fine of $9.33 million, and undertake specified remedial and compliance efforts. The bank simultaneously entered into a separate settlement regarding tax evasion.  DOJ; USAO EDNY

April 29, 2020

North Carolina physician Ibrahim Oudeh and his wife Teresa Sloan-Oudeh will pay up to $8.8 million to resolve claims of Medicare and Medicaid fraud.  Between 2010 and 2017, the Oudehs reportedly submitted more than 40,000 false claims, including more than 37,000 claims for laboratory tests, including nerve-conduction studies that Dr. Oudeh was not qualified to interpret, the vast majority of which were medically unnecessary.  To submit as many claims as they did, defendants falsely billed for office visits, in some instances billing for more than 24 hours of visits in a single calendar day.  The Oudehs sometimes used outside physicians to interpret laboratory tests, but paid those physicians less than their practice’s Medicare reimbursement, a violation of the Anti-Markup Rule.  Defendants will forfeit $3.3 million in assets and pay an additional $5.5 million.   USAO EDNC; NC

April 29, 2020

Lender Guaranteed Rate, Inc. will pay $15.1 million to resolve allegations that it knowingly failed to adhere to material program requirements in originating and underwriting mortgages insured by FHA or guaranteed by the VA, resulting in mortgages that did not meet credit and underwriting requirements for the government-sponsored guarantees and insurance.  The case was initiated by a whistleblower complaint filed under the False Claims Act by an unnamed former Guaranteed Rate employee, who will receive $2.4 million of the settlement proceeds.  The settlement also resolved claims under FIRREA.  DOJ; USAO NDNY
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