New York City’s False Claims Act, originally passed in 2005, is set to expire in June 2012.  On January 20th, the City Council’s Committee on Governmental Operations heard testimony on the history of the act and whether it should be renewed.  In its written testimony, the New York City Law Department noted that seventeen on-going cases could be adversely affected if the city’s FCA were allowed to expire since the savings provision of the Act only protects actions which have been officially commenced before its expiration date.  The New York City Department of Investigation remarked that the city had received fifty two submissions under the city’s FCA, thirty of which were submitted in the last two years.  The Department of Investigation stressed that receiving advanced notice through NYC FCA complaints has been pivotal to its ability to effectively investigate alleged misconduct, recover funds, or stop fraudulent activities.

Whistleblower attorneys Neil Getnick and David Koenigsberg spoke of the importance of the city’s False Claims Act and suggested several potential reforms, including conforming the city’s act to the recently revamped New York State False Claims Act.  Mr. Getnick lauded the city for being a trailblazer in the field and encouraged the city to once again embrace that spirit and follow New York State in passing the most aggressive anti-fraud False Claims Act in the country.  The 2010 amendments to the state FCA provide for enhanced protections for whistleblowers, narrow the bar on actions derived from publicly disclosed information, and allow whistleblower-driven tax fraud actions.  Additionally, Mr. Koenigsberg suggested the city amend the act to permit whistleblowers to pursue the case after the city has declined to proceed.

Read the Committee Report and Hearing Testimony