West Virginia’s Proposed False Claims Act under Attack by Chamber of Commerce

Proposed false claims act legislation is one of the first bills to advance in the West Virginia House Judiciary Committee on the first day of the legislative session. The legislation establishes qui tam proceedings, legal action brought by private citizens against the state or companies doing business with the state believed to have committed fraud or violated the law.

“It incentivizes reporting internally from anyone working inside the government or anyone working inside private companies who see their companies overcharging the government,” Tim Miley, Speaker of the WV House of Delegates said on MetroNews Talkline last week.

The legislation will assist by identifying possible Medicaid fraud in the state, which is one of the main purposes of the bill. Some legislators have cautioned that the claims could overwhelm the Office of the Attorney General. “Anybody who is complaining about the bill for those reasons is doing so because they want to hide some of the government fraud,” Delegate Stephen Skinner, D-Jefferson told The Journal.

Skinner pointed to controversial deals such as “Routergate” to show the necessity for a state False Claims Act. In 2013, an audit revealed that state officials wasted millions of federal stimulus dollars when they purchased more than 1,000 routers. The $24 million was supposed to be used to increase Internet access in the state.

The legislation is under attack by West Virginia’s corporate lobby. The chemical spill in Charleston that contaminated the drinking water for 300,000 residents hasn’t slowed down the corporate lobby’s drive to kill off this bill which is needed to protect the residents of West Virginia. The President of the West Virginia Chamber of Commerce, Steve Roberts, is characterizing the proposed law as a scheme for trial lawyers to get rich.

Roberts told Talkline that the proposal was nothing more than “a sue and settle scheme developed by the trial bar to try to expand the opportunity for lawsuits in West Virginia.”

Patrick Burns of Taxpayers Against Fraud took issue with Roberts’ claims.

“Do lobbyists for corporate crooks oppose paying fines and restitution?” Burns told Corporate Crime Reporter. “Of course. The fox is always opposed to anyone guarding the hen house.”

“The good news is if West Virginia wants to see a model for success, they only need look next door.”

“Virginia passed a state False Claims Act in 2002, and since then that state’s Medicaid Fraud Control Unit has returned an average of $228 million per year.”

“Virginia has also recovered millions of stolen dollars for its state pension fund, and is set to recover millions more for defective water pipe installed by municipalities.”

The federal government’s first False Claims Act was signed into law in 1778. Close to 30 states now have state False Claims Acts, including Texas, Maryland, New York, California, Michigan, Illinois, and Florida.

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