The federal government usually recovers lots of money related to settlements and judgments that come from the federal False Claims Act. No wonder, the Minnesota Legislature also decided to pass it’s version of the False Claims Act called the Minnesota False Claims Act. This act closely resembles the federal False Claims Act.
This means it also imposes treble damages and civil penalties against any contractor who submits false claims to public entities in Minnesota. But unlike the federal False Claims Act, the Minnesota False Claims Act has a safe harbor provision that only applies in certain situations. This article explains what you need to know about the Minnesota False Claims Act.
Federal False Claims Act
It makes sense to first discuss the federal False Claims Act so that you can see the differences with the Minnesota False Claims Act. It’s worth noting that the federal False Claims Act can impose penalties of between $5,500 and $11,000 for any false claim that is submitted to the government.
There is also at least three times the amount related to damages that the government sustains. Another remedy can also be a suspension or even exclusion from work on any future government projects.
Besides this, there have been recent changes to the federal False Claims Act that makes it a violation to give a false claim to a person, especially if the beneficiary happens to be the federal government. As a result, subcontractors can be liable for these false claims that are given to general contractors working on federal projects.
The federal False Claims Act also states that a person who decides to sue on behalf of the government, known as a relator can be entitled to at least 15 to 30% of the recovered damages. But the attorney fees can be given to the prevailing party.
Minnesota False Claims Act
There can be huge penalties when it comes to the Minnesota False Claims Act, so it’s crucial to know what makes up a false claim. A claim can be defined as any demand or request for money or even property that a contractor makes to the state.
Simply put, you can violate the Minnesota False Claims Act if you knowingly present a false claim to receive payment. You can also violate it if you utilize a false record to receive a claim approved or paid, or knowingly conspire to defraud the government by giving a false claim or utilizing a false record to receive payment.
The Minnesota False Claims Act also requires that you should give a false claim knowingly. Knowingly refers to the person who has the knowledge that the information is false, or you act in reckless or ignorance by disregarding the truth.
It’s important to note that there is no need for specific proof of intent when it comes to defrauding the state. For example, you can request payment based on information that you know is inaccurate like incorrect values. This can lead to violation if there is a desire to defraud the state or not.