False Claims Act Gets Bureaucratic Overhaul with Inflation Penalties
Published Date: 4/23/2026
Rule
Summary
Starting May 26, 2026, the Federal Labor Relations Authority is rolling out new rules to handle false claims under the updated Administrative False Claims Act (AFCA). This affects anyone dealing with government claims, making sure false statements get caught and dealt with fairly. Agencies now have clear steps to follow, and penalties may adjust with inflation, so watch your paperwork!
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Analyzed Economic Effects
6 provisions identified: 1 benefits, 4 costs, 1 mixed.
Civil Penalty Raised to $12,500
If you are alleged to have made a false claim or false statement to the FLRA, the civil penalty for that false claim or statement is set at $12,500. This adjusted penalty replaces the prior statutory $5,000 figure and is effective under the rule that takes effect May 26, 2026.
Double Damages Assessment Possible
If you are found liable under the AFCA, liability can include an assessment of up to twice the amount of the false claim in addition to a civil penalty. The rule implements that statutory liability structure in the FLRA's procedures.
Default: 30-Day Answer Rule and Maximum Penalty
If you are served with an AFCA complaint, you must file an answer within 30 days. If you do not file an answer within 30 days, the presiding officer will assume the complaint's facts are true and may impose the maximum penalties and assessments without right to appeal, subject to narrow motions to reopen.
Notice and Statute-of-Limitations Timeframes
A notice to someone alleged liable under the AFCA must be mailed within the timeframes in 31 U.S.C. 3808(a): the later of 6 years after the violation or 3 years after the facts were (or should have been) known, but in no event more than 10 years after the violation. Civil actions to recover penalties or assessments must be commenced within the 3-year timeframe in 31 U.S.C. 3808(b).
DOJ Approval and $1,000,000 Threshold for Complaints
The reviewing official may issue an AFCA complaint only if the Department of Justice provides written approval, and for allegations about a claim under 31 U.S.C. 3802(a)(1) the reviewing official must determine the amount demanded does not exceed $1,000,000 for claims submitted simultaneously. Related or unrelated claims may be joined under other provisions.
Anyone Can Report; IG May Subpoena
Anyone may submit or refer a complaint or information to the FLRA Inspector General through the public Hotline, and the investigating official (the Inspector General) may use subpoena authority under 31 U.S.C. 3804 or other authorities to investigate matters that could lead to AFCA actions.
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