The Department of Justice published its False Claims Act (FCA) statistics for Fiscal Year 2024 this month, revealing a nearly 40% increase in whistleblower filings, increased recoveries year over year, and a near record number of settlements and judgments.
Key takeaways include the following:
Healthcare fraud continues to dominate FCA activity, accounting for over $1.67 billion of the $2.9 billion in settlements and judgments. Recoveries involved managed care providers, hospitals and other medical facilities, pharmacies, pharmaceutical companies, laboratories, and physicians. The total could have been significantly higher: DOJ entered into a $425 million settlement with a generic drug manufacturer just after the close of FY 2024. DOJ also highlighted that additional funds were recovered for state Medicaid programs, and the Department continues to work closely with State Attorneys General to recover additional amounts for these state programs.
Additionally, DOJ secured its first significant FCA settlement related to pharmacy benefit manager’s drug rebates, resolving allegations related to improper reporting of manufacturer rebates as bona fide service fees. DOJ continued to actively pursue violations of the Anti‑Kickback Statute and, in turn, secured millions to resolve allegations of kickbacks ranging from commission-based referrals to travel and lavish dinners. Finally, DOJ continued to pursue claims related to the opioid crisis, securing an agreement for a general unsecured claim of $475.6 million related to aggressive marketing of an opioid drug to high-volume opioid prescribers.
In reporting its FY 2024 results, DOJ pointed to the settlement it entered into with Raytheon Company. The settlement was the second largest FCA government procurement fraud recovery ever and was finalized in FY 2025. The settlement resolved allegations that the defense contractor double billed on a weapons maintenance contract and knowingly provided false information to the Department of Defense during government contract negotiations.
Launched in 2021, DOJ’s Civil Cybersecurity Fraud Initiative uses the FCA to enforce contractual cybersecurity requirements. To date, the government has taken enforcement action against government vendors and contractors under the FCA who allegedly knowingly: (1) provide deficient cybersecurity products or services; (2) misrepresent their cybersecurity practices or protocols; or (3) fail to monitor and report cybersecurity incidents or breaches. DOJ entered into substantial settlements with contractors, service providers, and academic institutions to resolve claims that they failed to meet cybersecurity requirements and to secure personal information. Expect DOJ to continue to use the FCA to pursue entities that fail to comply with contractual obligations regarding cybersecurity.
Recoveries for pandemic fraud such as improper payments under the Paycheck Protection Program (PPP) and fraudulent COVID-19 tests and treatment skyrocketed to $250 million in FY 2024, easily eclipsing the $48.3 million total that DOJ reported for FY 2023. Significant recoveries included a $120 million claim in the bankruptcy proceeding of Kabbage Inc., a financial technology company alleged to have systemically inflated PPP loans, and a $14.3 million payment from a laboratory owner to resolve allegations related to generating orders of respiratory pathogen panel tests with forged physician signatures.
FCA claims brought by whistleblowers continue to dominate recoveries. Of the $2.9 billion recovered in FY 2024 settlements and judgments, $2.4 billion arose from whistleblower qui tam suits, and whistleblowers received over $400 million in relator shares.
DOJ’s FCA recovery statistics prove again what practitioners, industry participants, and enforcers have come to expect: the FCA continues to be the government’s primary tool in combatting fraud on the government. How will the new Administration utilize the FCA to pursue its own priorities and initiatives? Stay tuned.