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Adler-Vitale ‘New Jersey False Claims Act’ Approved By Senate

Senator John Adler, D-Cherry Hill, the Chair of the Senate Judiciary Committee, reads the list of nominees on the Senate floor.

TRENTON – A bill sponsored by Senators John H. Adler and Joseph F. Vitale which would establish the “New Jersey False Claims Act” to protect against abuse and fraud within Medicaid and other State claims programs was approved by the Senate today by a vote of 37-0.

“New Jersey needs to do everything in its power to stop fraud and abuse of the public trust, whether by private citizens or public officials,” said Senator Adler, D-Cherry Hill. “This bill will be another weapon in the arsenal of good government.”

“Medicaid and other claims programs are designed to serve as a safety net for those New Jerseyans who need them,” said Senator Vitale, D-Middlesex. “However, when those programs are subject to fraud and abuse, our ability to help those with legitimate claims is diminished. We need to send a strong message that taking advantage of these programs isn’t worth the risk of the severe penalties you’ll be facing if you’re caught.”

The bill, a Senate Committee substitute for S-360 and S-1829, would allow private individuals in New Jersey to bring an action, either by themselves or working with the State Attorney General, against any person who knowingly causes the State to pay a false claim. If a person is found guilty in court, the bill would create civil penalties, between $5,000 and $10,000, for each verified count of a false claim, as well as imposing up to three-times the cost of any losses the public entity would have sustained because of the false claim.

“By establishing some serious consequences, I hope we can deter future cheats from defrauding State claims programs,” said Senator Adler. “Especially in these tight fiscal times, if you use the State’s good intentions to rob from those who really need these programs, you deserve the strictest penalties possible.”

The bill also sets up a whistleblower incentive to come forward with any information about false claims. If a false claim is proven in court, the whistleblower would be entitled to 15% to 25% of the proceeds recovered for New Jersey if the Attorney General brings the case, and 25% to 30% of the proceeds if the case is brought by the whistleblower. The exact amount of whistleblower compensation is determined by the courts.

“We want New Jerseyans to come forward and point the way towards misspent State claims,” said Senator Vitale. “The whistleblower incentives will hopefully encourage New Jersey’s citizens to follow their conscience and help the State in its false claims recovery efforts. We want to engage as many people as possible in our work to seek out and recover false claims in the Garden State.”

The bill now heads to the Assembly before going to the Governor to be signed into law.

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