False Claims Act / Qui Tam Elements of the Offense

The False Claims Act is often described as a fraud statute, which obscures how it works. Liability under 31 U.S.C. § 3729 does not follow from dishonest conduct in the abstract. It follows from a set of elements, and in a case tried in the Eastern District of Virginia those elements are framed for the jury under Fourth Circuit law. Knowing what each element requires is what tells a defendant where a case is weak.

The Act is civil, so the standard of proof is a preponderance of the evidence rather than proof beyond a reasonable doubt. That lower standard makes precision about the elements more important, not less. To discuss the elements at issue in a False Claims Act matter, call (888) 437-7747 to request a consultation.

On this page

The Claim and the Conduct

Every theory begins with a claim, meaning a request or demand for federal money or property. Without a claim there is nothing for the statute to attach to.

The Act then describes several distinct forms of conduct. A person may present, or cause to be presented, a false or fraudulent claim. A person may make, use, or cause to be made or used, a false record or statement material to a false claim. A person may conspire to do either. And a person may knowingly conceal or knowingly and improperly avoid or decrease an obligation to pay or transmit money or property to the United States, which is the reverse false claim theory. Each form has its own proof requirements, and a complaint that blurs them is vulnerable.

Falsity, Knowledge, and Materiality

Falsity measures the submission against what the contract, statute, regulation, or program rule actually required at the time. A submission that complied with the rule in force is not made false by a later change in the rule or by an auditor preferring a different approach.

Knowledge is defined in the Act itself. It covers actual knowledge that the information is false, deliberate ignorance of its truth or falsity, and reckless disregard of its truth or falsity. No proof of specific intent to defraud is required, which is a meaningful difference from the criminal fraud statutes and a common source of confusion.

Materiality asks whether the false record, statement, or omission had a natural tendency to influence, or was capable of influencing, the payment or receipt of money or property. It is judged by the effect on the paying decision, not by how a requirement is labelled in the contract.

Frequently Asked Questions

Does the government have to prove intent to defraud?

No. The Act defines knowledge to include deliberate ignorance and reckless disregard, and it states that no proof of specific intent to defraud is required. That is a lower threshold than the criminal fraud statutes use. It also means a defense resting only on the absence of a scheme will not reach the element, and the record must instead show that accuracy was actually considered and addressed.

What is the standard of proof?

A preponderance of the evidence, because the liability provision is civil. That is the ordinary civil standard, not the criminal standard of proof beyond a reasonable doubt. Where the same conduct is charged criminally under a different statute, the criminal standard applies to that case, which is one reason the two tracks can reach different outcomes on the same records.

What is a reverse false claim?

It is the theory that reaches money owed to the United States rather than money requested from it. Knowingly concealing, or knowingly and improperly avoiding or decreasing, an obligation to pay or transmit money or property to the government can create liability even though no invoice was ever submitted. Retaining a known overpayment is the most common example, which is why overpayment handling procedures matter so much.

Is every regulatory violation a false claim?

No, and this is where many cases fail. A violation has to be tied to a claim and has to satisfy materiality. Requirements that the paying agency treats as minor, waives in practice, or continues to pay through with full knowledge are difficult to characterize as capable of influencing the payment decision. The label attached to a requirement in a contract does not decide the question.

Who can be liable besides the entity that billed?

The statute reaches a person who causes a false claim to be presented, so subcontractors, suppliers, consultants, and individuals who prepared or approved the submission can be within its scope even though they never invoiced the government directly. Conspiracy liability extends it further. This is why individual executives and billing personnel often need their own counsel rather than relying on the company.

Where are these elements decided in northern Virginia?

Civil False Claims Act cases arising in northern Virginia are litigated in the United States District Court for the Eastern District of Virginia, and the governing appellate law comes from the United States Court of Appeals for the Fourth Circuit. That court has addressed falsity, the knowledge standard, and materiality on numerous occasions, and its decisions frame how those elements are presented to a jury.

How Mr. Sris and the Firm’s Of Counsel Attorneys Handle Element-Level False Claims Act Analysis

Element analysis is the least dramatic and most useful stage of a False Claims Act matter. Sorting which theory is actually pleaded, and which element it depends on, narrows the evidence that matters and often shows early that a claim cannot reach one of its required parts.

Mr. Sris, Owner and Founder of Law Offices Of SRIS, P.C., is a former prosecutor and founded the firm in 1997. He is admitted in Virginia, Maryland, the District of Columbia, New Jersey, and New York. His background at George Mason University in accounting and information systems is applied to complex financial and technology-related cases, which is the category these matters fall into. Mr. Sris and the firm’s Of Counsel attorneys, who contract directly with the firm, work on federal criminal matters together.

The firm represents contractors, health care organizations, grant recipients, and individuals in False Claims Act and qui tam matters in federal court, including matters still under seal. To discuss the elements at issue in a False Claims Act matter, call (888) 437-7747 to request a consultation.

Disclaimers

This page describes the elements of liability under the False Claims Act at 31 U.S.C. § 3729 in general terms for people trying to understand a federal process. It is not legal advice, and reading it does not create an attorney-client relationship with Law Offices Of SRIS, P.C. Federal statutes and the decisions interpreting them change over time, so confirm anything stated here against the current statutory text with counsel before acting on it.

Every federal matter turns on facts that belong to that matter alone. Case results depend on a variety of factors unique to each case. Results may vary.

Attorney responsible for this advertising: Mr. Sris. Law Offices Of SRIS, P.C. Call (888) 437-7747 to request a consultation; the firm’s intake line is staffed 24/7.

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These are the elements the government must prove. Our page on false claims act qui tam charges covers the offence as a whole.