The many agencies of Colorado and the federal government handle millions of dollars every day, making payments to contractors, purchasing goods needed in government, and making payments under government grant programs.
As such, they are obvious targets for persons willing to use fraud to steal some of those funds. Both the U.S. Congress and the Colorado legislature have passed laws intended to curb such actions. The federal law is known as the Federal False Claims Act, and the Colorado law is known as the Colorado False Claims Act.
Colorado False Claims Act
The Colorado False Claims Act states that a person is liable to the state or any political subdivision of the state for a civil penalty if the person is convicted of committing, conspiring to commit, or aiding and abetting any of the enumerated acts:
- Knowingly presenting or causing to be presented a false claim for payment or approval
- Knowingly making, using, or causing to be made or used a false record or statement material to a false or fraudulent claim
- Having possession, custody, or control of property or money belonging to the state or a political subdivision and knowingly delivering, or causing to be delivered, less than all of the money or property
A person who is convicted of making a false claim is liable to the state for a civil penalty of $11,800 to $23,600 per violation, plus three times the amount of actual damages sustained by the state.
Attorney general to investigate
The False Claims Act requires the attorney general to investigate potential false claims. The attorney general or a private person may bring a civil action against a person who made a false claim, and the attorney general may intervene in a civil action brought by a private person. A private person who brings a false claims action may be awarded up to 30% of the proceeds from the action based on the extent the private person contributed to the investigation and prosecution of the false claim.
The law prohibits retaliation against an individual whose efforts led to a false claims lawsuit.
A false claims lawsuit can involve many complicated issues that range from obscure accounting techniques to complex schemes to steal and hide government property or money. Government agencies usually provide their own attorneys to pursue the basic claims of fraudulent conduct, but a whistleblower who wants to claim the substantial rewards provided by the statute may wish to consider retaining a lawyer with experience in handling false claims.