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On April 21, 2021, the Department of Justice (DOJ) inked its second civil settlement resolving allegations of fraud involving loans issued pursuant to the Paycheck Protection Program (PPP). Sandeep S. Walia, M.D., a Professional Medical Corporation (Walia PMC), and its owner, Dr. Walia, agreed to pay $70,000 in damages and penalties to resolve alleged violations of the False Claims Act (FCA) tied to allegations that Dr. Walia falsely certified in a second PPP loan application that his medical practice had not previously received a PPP loan after it had already received one from a different lender.  Walia PMC also agreed to repay the second PPP loan for $430,000.  This latest settlement is a continued reflection of the heightened scrutiny of the PPP, and suggests that the FCA may quickly become a favored enforcement tool by the government in its continued pursuit of PPP-related fraud.
Continue Reading Avoiding Loan Forgiveness Is No Shield from False Claims Act Liability in Latest Paycheck Protection Program Fraud Settlement

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The Government Accountability Office (GAO) has added emergency loans for small businesses to its list of government programs vulnerable to fraud, waste, abuse, and mismanagement. On March 2, 2021, GAO released its latest High Risk List identifying troubled federal government programs in need of significant improvement. The GAO concluded that the Small Business Administration (SBA) must demonstrate more robust integrity controls and better management practices over the PPP and EIDL programs. GAO’s findings put pressure on the SBA to ensure quicker adoption of GAO’s recommendations for improvements and keeps public focus on the need for SBA audits and investigations of Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) program participants.
Continue Reading GAO’s High Risk List Puts Spotlight on Emergency Loans For Small Businesses, Reinforcing Audit and Investigation Risk for PPP and EIDL Program Participants

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On February 25, 2021, the U.S. Attorney’s Office for the Southern District of Illinois announced a settlement to resolve allegations that a contractor that was not an eligible participant in the Small Business Administration’s 8(a) Business Development Program violated the False Claims Act by controlling a joint venture that claimed 8(a) status and won an

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In this episode, host Mana Lombardo and partner Tully McLaughlin discuss the top FCA decisions and developments of 2020 and look ahead to what’s in store in 2021 and beyond. “Let’s Talk FCA” is Crowell & Moring’s podcast covering the latest developments with the False Claims Act.

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On January 19, 2021, the Eleventh Circuit affirmed a district court’s rejection at summary judgment of a disgruntled employee’s False Claims Act (FCA) retaliation claim in Hickman v. Spirit of Athens, No. 19-10945 (11th Cir. Jan. 19, 2021). The Court’s decision makes clear that, despite expansions to the FCA in 2009 and 2010 protecting employees who engage in “efforts to stop 1 or more violations” of the FCA, plaintiffs must nevertheless establish that they held an objectively reasonable belief that they were attempting to prevent the submission of false claims to the government for their conduct to constitute protected activity.

The plaintiffs worked for Spirit of Athens, a nonprofit organization. The executive director became concerned in reviewing tax returns that $61,000 of the organization’s expenses were generally categorized as “other expenses” without any further explanation. The executive director verbally retracted her signature on the tax forms, but the organization’s president signed and submitted them himself. The executive director and her assistant then arranged for the board members to receive a copy of the tax documents, shared their concerns with the president, and even hired an outside firm to audit the organization’s tax returns. Apparently unhappy with the executive director and her assistant’s conduct, the president fired them. The two then brought suit against the organization, claiming that they were terminated for “their attempts to combat the organization’s misuse of federal funds.” The district court granted summary judgment for the defendant, finding that plaintiffs had failed to establish that they had engaged in protected activity under the FCA.


Continue Reading Eleventh Circuit Holds that a Sincere Belief is not the Same as a Reasonable One Under the False Claims Act’s Retaliation Provision

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In General Medicine, P.C. v. United States, No. 3:20-mc-00053, the District Court for the Southern District of Illinois held that a third party has standing to challenge a False Claims Act (FCA) civil investigative demand (CID) that is issued to another entity. In that case, General Medicine, a company that employs physicians and nurse

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In this episode, hosts Jacinta Alves and Mana Lombardo discuss DOJ FCA investigations and common mistakes that targets make in defending these investigations with partner Michael Shaheen. “Let’s Talk FCA” is Crowell & Moring’s podcast covering the latest developments with the False Claims Act.

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In this episode, hosts Mana Lombardo and Jacinta Alves discuss the $175 Billion CARES Act Provider Relief Fund established in response to the COVID-19 Pandemic and FCA risks associated with receipt of those funds. “Let’s Talk FCA” is Crowell & Moring’s podcast covering the latest developments with the False Claims Act.

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On June 17, 2020, the Pandemic Response Accountability Committee (PRAC) issued its first report, “Top Challenges Facing Federal Agencies: COVID-19 Emergency Relief and Response Effort” (the “Report”). PRAC was established by the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). It consists of the twenty-one offices of inspectors general (OIGs) that oversee the

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The third year of False Claims Act (FCA) enforcement under the Trump administration was defined by a number of notable settlements, the implementation of several policy changes announced last year concerning how the Department of Justice (DOJ) will pursue (and in some instances, dismiss) cases under the FCA, and a Supreme Court decision addressing the