With great crises comes great compliance risk. The COVID-19 pandemic is no exception. Signed into law just recently, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) will make available an initial $2.2 trillion worth of government funds to mitigate the economic effects of COVID-19.
Former crises, such as Hurricane Katrina, teach us that when the dust begins to settle, and probably sooner, government enforcement actors will aggressively search for fraud in the form of any misrepresentations made to the government to receive these funds, invoking the federal False Claims Act (FCA) and seeking treble damages, fines, and criminal referrals where appropriate. Private lawyers and bounty hunters will be watching closely as well, with many of them seeking opportunities to cash in on a bounty as a whistleblower. In particular, all companies and individuals submitting information to the government in connection with getting any type of claim paid (from a government contract to a Paycheck Protection Program (PPP) loan to a bill for medical services) will face enhanced compliance risk in connection with FCA claims.