Senator Williams Remarks on False Claims Act
As a whistleblower and an attorney who worked with whistleblowers for years, I can tell you that people want to do the right thing. They want to report fraud when they see it. But there are a lot of risks in doing so. They may lose their job, their pension, and their healthcare all in one fell swoop.
According to the Association of Certified Fraud Examiners 2018 Global Study on Fraud, 40% of fraud is initially detected by atip and 2% of fraud is initially detected by law enforcement. I knew that number before I even looked it up because when I was working at the National Whistleblowers Center in 2008, the statistic was 46.2% of fraud was initially detected by a tip and 3.2% was detected by law enforcement. I have repeated that statistic a lot over the years.
The Association conducts this global fraud study every 2 years and the numbers are about the same every time. That means that even if Attorney General Shapiro or Auditor General DePasquale do a fantastic job they will only find about 2-3% of fraud. That is simply not good enough. Pennsylvania taxpayers deserve to have their money spent in a responsible and accountable way and we can’t say that it true right now. We have to do more to encourage people to tip off law enforcement to state tax fraud.
And we know how to do that. It is the False Claims Act. In 2018 alone, the federal government recovered $2.8 billion under the federal False Claims Act. Thirty-one states have seen the value in passing their own state false claims act. The Federal Government and many other states have recognized that protecting and encouraging people to report fraud is the absolute best way to detect fraud and deter future fraud. The anti-retaliation provisions in the False Claims Act are the protections that make it less likely that a person will lose everything when they speak up to protect our taxpayer dollars.
Right now if you were to walk into an attorney’s office and ask about how to report abuse of state taxpayer dollars, the attorney would tell you the mechanics but would also tell you that there is little to nothing to protect you from getting fired for reporting. Most people cannot afford to take that risk. We don’t want people to walk out of that office and stay silent.
I want to protect them so that they can protect us. Protecting taxpayer dollars is not a Republican or Democrat issue. I had the pleasure to work with U.S Senator Chuck Grassley on federal legislation to extend the False Claims Act to Securities and Commodities fraud. I am proud to now be working with Representative Grove as the prime sponsor of the Commonwealth Fraud Prevention Act in the Senate. The Senate bill has 16 co-sponsors so far including Democrats and Republicans. Pennsylvania has lost millions of taxpayers dollars to fraud and we simply can’t afford to wait to pass this legislation.