Written by: Goodwin
The federal False Claims Act (FCA) has long been a powerful tool for the U.S. Department of Justice (DOJ) — or private whistleblowers bringing suit on the DOJ’s behalf — to investigate and police activity financed with federal dollars. The FCA broadly imposes liability on anyone who knowingly submits or “causes” the submission of a materially false claim or false statement in connection with the receipt of federal funds.
Higher education institutions have increasingly been a target of FCA investigations. Recent years have seen high-profile enforcement actions against colleges and universities receiving federal funds for a variety of purposes, including research grants and financial aid programs. The risk of FCA scrutiny — and potential liability — is further heightened for colleges and universities receiving Coronavirus Aid, Relief and Economic Security (CARES) Act funds in the wake of COVID-19. While these funds may help institutions weather the financial difficulties wrought by the pandemic, recipients should also be mindful that heightened government scrutiny is likely to follow.
Below, we discuss recent FCA enforcement trends in higher education — and steps that institutions can take to mitigate FCA risk going forward.