Consumer Law

New Fraud Law Adds Important Layers of Corporate Accountability

By Andy Hoffman

We?ve talked about the importance of broadening the liability of those whose unscrupulous actions helped create the country?s current economic woes, so you can imagine how tickled we were to learn that President Obama signed into law some of ?the most significant changes in 23 years? to the federal False Claims Act (FCA).  Essentially the new law fixes some bad Supreme Court decisions, expands the authority of prosecutors to investigate mortgage fraud and predatory lending, and amends the law to cover subcontractors.

Obama said the law ?gives prosecutors and regulators new tools to crack down on what helped cause this crisis in the first place, and that's the twin scourges of mortgage fraud and predatory lending.?  He noted that last year, the Treasury Department received 62,000 reports of mortgage fraud,
(more than 5000 per month!).

??These changes are desperately needed,? said Jeb White, president of Taxpayers Against Fraud,  particularly now as the government increasingly relies on contractors to pay out federal funds, whether under the Troubled Asset Relief Program (TARP) or existing programs such as Medicare."

Full post as published by ThePopTort on May 26, 2009 (boomark / email).