Finding fraud

President Abraham Lincoln called the fraudulent suppliers to the Union Army “worse than traitors,” and created The False Claims Act to stop them. President Ronald Reagan updated the act, which has recovered more than $4 billion in tax dollars. Especially at a time when million-dollar missiles buzz like black flies over Yugoslavia, Congress should ensure that the act remains effective.

Mistakes made by defense contractors rarely are trivial. Early amphibious Bradley Fighting Vehicles worked well except for one problem: they leaked. The manufacturer, FMC Corp., according to the group Taxpayers Against Fraud, were found to have falsified the swim test for the vehicles. Similarly, Lucas Industries in 1995 was found to have sold defective aircraft parts used for carrier-based Navy fighters. Still ongoing is a case against Boeing Corp., which is charged with knowingly delivering helicopters with defective gears. These gears are suspected in the crashes of Chinook helicopters in Saudi Arabia in 1991.

Unfortunately, some members of Congress, under heavy lobbying pressure from the defense industry, would rather see it weakened. Specifically, they are concerned that the act is used to punish honest mistakes and that its burden of proof is too low. On the first point, the inspector general for the Defense Department, Eleanor Hill, testified last year that there was no evidence of such misuse of the statute from those making these arguments.

“… The act,” she said, “requires a knowing submission of a false or fraudulent claim; the knowing use of a false record or statement to get a false or fraudulent claim paid; or a conspiracy to defraud the government by knowingly getting a false or fraudulent claim paid.” Honest mistakes aren’t the problem.

On the burden-of-proof claim, the Attorney General’s Office can apply to the defense industry the standards it uses in inspecting health care questions. After hearings in 1998, Deputy Attorney General Eric Holder recognized the false claims statute as “one of the department’s most powerful tools,” and offered guidelines to prevent the pursuit of trivial cases. This need not require an act of Congress.

Besides, how could members of Congress tell Americans risking their lives over Yugoslavia that their safety is secondary to defense industry profits?