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You are here: Home / Government Contracting News / Money For nothing … except potential False Claims Act liability

August 19, 2020 By cs

Money For nothing … except potential False Claims Act liability

Businesses and health care entities that receive CARES Act funds become attractive targets for whistleblowers and government auditors.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act (P.L. 116-136) was passed by Congress and signed into law by President Trump on March 27, 2020.  The CARES Act provides over $2 trillion of economic relief in order to protect the American people from the public health and economic impacts of COVID-19.  Throughout its more than 300 pages, the CARES Act implements many initiatives targeted at various industries and economic sectors that are designed to stimulate cash flow and provide security for those at-risk.

The most notable provisions of the CARES Act impact individuals directly and include an expansion of unemployment benefits and direct payments to individuals under a certain income threshold.  The CARES Act also provides protections for both large and small businesses, including $500 billion allotted for distressed industries, as well as $376 billion to small business in the form of various lending programs.

The CARES Act also appropriates $100 billion to establish the “CARES Act Provider Relief Fund” for  the benefit of hospitals and other eligible health care providers for health care related expenses or lost revenues due to COVID-19, which was further supplemented in April 2020 with an additional $75 billion under the Paycheck Protection Program and Health Care Enhancement Act (PPP Act).

In addition, the CARES Act authorizes relief to federal contractors and subcontractors for paid sick leave incurred to keep workers in a ready-state. In order for businesses to take advantage of these funds, they are required to complete applications and make representations as to eligibility to receive the appropriated funds.

While such a massive infusion of cash into the US economy is welcome by individuals and businesses impacted by COVID-19, such payouts come with complex strings attached, and therefore present opportunities for companies and individuals to run afoul of federal law.

Keep reading this article at: https://www.mondaq.com/unitedstates/government-contracts-procurement-ppp/973148/money-for-nothingexcept-potential-false-claims-act-liability

The Contracting Education Academy at Georgia Tech has established a webpage where all contract-related developments related to the coronavirus (COVID-19) are summarized.  Find the page at: https://contractingacademy.gatech.edu/coronavirus-information-for-contracting-officers-and-contractors/

Filed Under: Government Contracting News Tagged With: audit, CARES Act, coronavirus, COVID-19, false claims, False Claims Act, liability, pandemic

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