Attorney General Tong Seeks Expanded Fraud-Fighting Authority
(Hartford, CT) – Attorney General William Tong announced today he is seeking expanded authority to fight fraud and abuse across Connecticut state government.
In 2009, Gov. M. Jodi Rell signed into law Connecticut’s False Claims Act, giving the Office of the Attorney General authority to investigate and civilly prosecute fraud and abuse of taxpayer funds. Since then, the Office of the Attorney General, in conjunction with federal and state law enforcement partners, has recovered over $181 million in misspent public dollars. But Connecticut’s law is exceptionally weak—it applies only to spending in State-administered health or human services programs. Connecticut’s law is far more limited than any one of our bordering states.
Legislation proposed by Attorney General Tong seeks to expand the scope of Connecticut’s False Claims Act by removing provisions that limit application of these statutes to State-administered health or human services programs. More than one hundred different agencies, offices, and quasi-public agencies spend tax dollars on behalf of the government of the State of Connecticut. The current Connecticut False Claims Act covers programs at just nine agencies. The legislation would allow the Office of the Attorney General to pursue fraud and abuse of tax dollars anywhere in State government, while also protecting and encouraging those who step forward to report fraud and abuse in any State spending.
States with similar False Claims Act authority have successfully pursued cases involving wage theft and wage violations, false claims regarding minority contracting requirements, defective and shoddy equipment, false safety certifications regarding dangerous construction conditions, unreliable environmental testing results, and more.
“No state agency, contract, or public dollar is immune from fraud, abuse, and corruption. That is true here in Connecticut, as it is everywhere. Connecticut needs the same laws and protections as every one of our neighboring states so that my office can pursue bad actors and get money back for taxpayers,” said Attorney General Tong. “My office has a 13-year track record of successful health care fraud prosecutions, based on excellent partnerships with our state and federal law enforcement and investigative partners. It’s time to close the False Claims Act loophole, build on that success, and ensure every taxpayer dollar is protected.”
"Connecticut taxpayers deserve an Attorney General's Office empowered to root out fraud against our state wherever it appears," said State Rep. Matt Blumenthal, House Chair of the Government Administration and Elections Committee. "For far too long, far too many taxpayer dollars have been shielded from scrutiny. Removing this loophole from our state False Claims Act will provide long-overdue accountability and restitution for fraud, wage theft, and other misconduct. With billions of dollars flowing to the state for vital projects enabled by the Bipartisan Infrastructure Law, the time to pass this legislation is now."
“It’s time to bring Connecticut up to speed with our neighbors and allow the attorney general to investigate fraud across more of state government. When agencies and contractors know they can be held accountable by the attorney general's office, there will be better outcomes. It’s a win-win for taxpayers and consumers, and for private-sector accountability,” said State Sen. Mae Flexer, Senate Chair of the Government Administration and Elections Committee.
“This legislation is a win for taxpayers and working people across Connecticut. There is no justification for limiting the scope and powers of the Attorney General to eliminate fraud. Current law only allows the office to pursue fraud in healthcare and human service programs administered by the state. But why stop there? By going after fraud anywhere the state does business, it helps create a level playing field for all businesses. Let’s finally untie the hands of the Attorney General so his office may fully pursue fraud and abuse anywhere state spending is involved,” said Ed Hawthorne, President of the Connecticut AFL-CIO.
“Expanding the applicability of our State’s False Claims Act is a sound and long overdue proposal,” said Foundation for Fair Contracting Director Kimberly Glassman. “With billions of tax dollars being spent to maintain and modernize Connecticut’s infrastructure, now is the time to send a strong message to unscrupulous contractors that they will be held accountable for flouting our laws and exploiting workers to pad their profits. We applaud the Attorney General for recognizing how pervasive wage theft is in the underground economy and for using every tool at his disposal to root out bad players. Strengthening wage enforcement is paramount to promoting a level playing field.”
“For too long, Connecticut has protected only its healthcare dollars from fraud,” explained Taxpayers Against Fraud President Jeb White. “However, this much-needed legislation extends False Claims Act liability to protect all State dollars. Fraudsters will now need to look to other states.”
The legislation would enable the Office of the Attorney General to summon witnesses and require the production of documents for the purpose of an investigation. In those cases where the investigation establishes a solid factual and legal foundation for a False Claims Act violation, it would enable recovery of the costs of the investigation and prosecution, three times the amount of damages sustained by the State, and civil penalties.
The federal False Claims Act, as well as the majority of other states’ False Claims Acts, establish liability for anyone who submits a “false or fraudulent” claim for payment to the government regardless of the agency or program paying the claim. A majority of states, including New York, Massachusetts, Rhode Island, New Jersey, and Vermont all have broad state False Claims Acts resembling the federal law. In stark contrast, the Connecticut False Claims Act only covers fraud occurring in a “State-administered health or human services program.”
The following are examples from recent False Claims Act cases in Massachusetts, New York, and New Jersey involving businesses:
• charging a state for N95 masks needed for the pandemic that were never provided,
• failing to pay prevailing wages to workers on state projects,
• lying about minority-owned businesses
• failing to provide safe working conditions
• delivering substandard fuel that clogged heating systems in state buildings,
• selling defective software for a state’s security cameras,
• obtaining contracts by faking compliance with state diversity requirements or misrepresenting the wages paid to workers,
• delivering unreliable environmental testing results,
• overstating bus trips made,
• concealing late deliveries to avoid paying refunds,
• falsely certifying the safety and substantial completion of the “Big Dig” tunnel that later collapsed, and
• delivering hand sanitizer with no alcohol to school children in the midst of the COVID-19 pandemic.
False Claims Act authority has been used in other states to hold landlords accountable when they violate housing subsidy rules and defraud taxpayers.
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