Fireman’s Fund Insurance Company agreed to pay $44 million to settle allegations that it knowingly issued insurance policies to ineligible recipients, according to a US Department of Justice (DOJ) press release.
These allegations were made under the False Claims Act, and the recipients were considered ineligible to receive these insurance policies under the U.S. Department of Agriculture’s (USDA) federal crop insurance program. Fireman’s Fund also allegedly falsified documents.
“Cheating the government by filing false claims for payment is actually just another way of robbing taxpayers,” commented Christopher Paulos, an attorney with the Levin, Papantonio law firm who practices in the areas of qui tam or whistleblower and False Claims Act litigation. “These allegations are pretty serious.”
The DOJ alleged that Fireman’s Fund issued federally-insured crop insurance policies that were ineligible under the federal reinsurance code. These alleged actions took place from January 1, 1999 to December 31, 2002. Fireman’s Fund allegedly forged signatures, backdated insurance policies, accepted altered documents, and signed documents after deadlines.
False claim scams cost American taxpayers billions of dollars every year. In 2013, the DOJ recovered $3.8 billion in misappropriated funds under the False Claims Act. Much of this bad behavior was outed by whistleblowers who may have worked at said company during the scam. Whistleblowers are protected under qui tam law.
In the case of Fireman’s Fund, the DOJ noted that “the claims settled by this agreement are allegations only, and there has been no determination of liability.”