Affirmative Civil Enforcement (“ACE”) refers to filing civil lawsuits on behalf of the United States. The purpose of these civil actions is to recover government money lost to fraud or other misconduct or to impose penalties for violations of Federal health, safety, or environmental laws. The following are examples of prosecutions under the ACE program:

• contractors who provide defective goods or worthless services to Federal agencies or who charge the government for goods and services not delivered;
• health care providers who defraud Federal health programs like Medicare and Medicaid by overbilling for goods and services or billing for goods and services that were not rendered, not medically necessary, or substandard;
• individuals who defraud Federal agencies such as the Small Business Administration, the Department of Housing and Urban Development, the Department of Education and other Federal agencies by using misrepresentations to obtain grants, loans and other benefits to which they are not entitled;
• companies and individuals to recover the government’s costs to clean up polluted land and water.

Usually ACE cases are pursued under the Federal False Claims Act, which affords the United States with a cause of action for false or fraudulent claims made against the government, or for false statements made to the government. The False Claims Act provides for recovery of triple the amount of damages incurred by the United States, plus a penalty of $5,500 to $11,000 for each violation.

Many of these cases result from qui tam or whistleblower lawsuits under the False Claims Act. In qui tam actions, individuals or entities with inside information about fraudulent conduct file suit on behalf of the United States. The ACE program then undertakes an investigation of the allegations. Whistleblowers, called relators under the False Claims Act, can receive a percentage of the government’s recovery.

Our ACE program is supported by Assistant United States Attorneys, five of whom are devoted full time to ACE prosecutions, including an ACE Coordinator and a Health Care Fraud Coordinator; a certified public accountant/certified fraud examiner/auditor; an investigator; a paralegal specialist, and a legal assistant. Investigations are undertaken with agents from the Federal Bureau of Investigation, the Offices of the Inspector General for the U.S. Department of Health and Human Services and other federal agencies, the Department of Defense, and others.

ACE cases can present facts and issues that warrant criminal as well as civil prosecution. In those instances, two or more Assistant United States Attorneys coordinate the investigation with law enforcement agents, using Federal criminal and civil laws to obtain the most effective resolution consistent with the objectives of punishment, deterrence and full restitution.

Nationally, ACE programs have recovered billions of dollars for the United States. In the District of Maryland, the ACE program has recovered millions of dollars by resolving, for example, cases against:

• a pharmaceutical company for paying kickbacks and for off-label marketing (multi-district);
• a company for selling defective laboratory animals to the National Institutes of Health that were used in government-funded research;
• contractors for billing the government for labor and other costs that were not expended on government contracts;
• physicians and hospitals for upcoding and billing for medically unnecessary services;
• a major medical research institution for misusing federal grants;
• a major medical institution for violating the Controlled Substances Act, resulting in significant losses of controlled substances.