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Sen. Grassley urges use of FCA to protect bailout funds

By Phillips & Cohen LLP

Sen. Charles Grassley, one of the authors of the 1986 amendments that strengthened the False Claims Act, is concerned that money authorized through the recently approved $700 billion bailout not be lost to fraud.

Sen. Grassley sent a letter to Treasury Secretary Paulson and Attorney General Mukasey, stressing the need for oversight and reminding them how effective the False Claims Act has been in preventing, deterring and prosecuting fraud.

Sen. Grassley stated that "entities who receive federal funds under the TARP [Troubled Asset Recovery Program] and CPP [Capital Purchase Program] are subject to the provisions of the FCA should they use false or fraudulent submissions in order to obtain federal funds. For instance, any entity that submits false or fraudulent information in an application to Treasury in order to obtain federal funds available through the CPP would be liable to the Government under the FCA."

Full post as published by False Claims Act - Qui Tam on November 20, 2008 (boomark / email).