Public Interest Briefs

In 1986, two events occurred which would prove of great benefit to taxpayers. The revised False Claims Act was passed, and Taxpayers Against Fraud (TAF), a new non-profit organization, was born to help implement the act.

These two “births” heralded the beginning of a concerted drive to eliminate fraud against the United States government. Since 1986, 304 cases have been filed under the Act, 75% of which are against defense contractors. In California, a similar impetus led to the passage of the California False Claims Act in 1987.

The original False Claims Act was enacted by Congress in 1863 during the Lincoln administration. Commonly referred to as the “Lincoln Law,” it was passed because businessmen were defrauding the Union Army by cutting gunpowder with sawdust and selling the same horses over and over to the cavalry. Through the years, its effectiveness was undermined by a series of court decisions and a 1943 amendment designed to bar “parasitic” lawsuits (suits filed by individuals after the government already had all the facts needed to make a case). But the new rash of highly publicized overcharges, such as the scale of $500 hammers and coffee pots, stimulated widespread interest in reviving the law. 

Perhaps the person most instrumental in reviving and updating the False Claims Act was John Phillips, one of the co-founder of the Center for Law in the Public Interest. “I came across the False Claims Act while doing unrelated research,” stated Phillips. “What jumped out immediately was the potential this law offered to achieve important public interest goals–ferreting out fraud against the government– while providing an ongoing revenue stream to support such work.”

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