Taxpayers Have A Right To Know About Allegations Of Fraud Against The Government, Say Watchdog Groups

FOR IMMEDIATE RELEASE

CONTACT: (212) 549-2666; media@aclu.org

NEW YORK – The overreaching secrecy provisions of a whistleblower law prevent the public from learning about serious allegations of fraud against the United States government, according to a complaint filed today by the American Civil Liberties Union and the ACLU of Virginia on behalf of themselves, the Government Accountability Project (GAP) and OMB Watch. Complaints filed under the False Claims Act (FCA) are automatically filed under seal and those who file them are gagged from speaking about them, keeping the complaints secret from the public for months or even years.

"Secret courts and secret proceedings have no place in this country," said Chris Hansen, senior staff attorney with the ACLU First Amendment Working Group. "There are plenty of procedures Congress or the courts could adopt to preserve the interest of privacy when it is warranted without enlisting the courts in a blanket scheme that automatically gags people who have information about possible abuse of taxpayer dollars."

Under the FCA, originally enacted by President Lincoln to combat war profiteering and other contractor fraud against the federal government, private citizens are entitled to bring complaints of fraud on behalf of the government. A 1986 amendment to the law requires that FCA complaints are automatically filed under seal and whistleblowers who file the complaints are gagged from speaking to anybody about them. The seal and gag are not lifted until the Justice Department decides whether it will pursue a complaint, which can be anywhere from 60 days to several years later. According to the Justice Department there were approximately 1,000 FCA cases under seal as of July 2007.

According to today's complaint, the FCA secrecy provisions have hidden an unknown number of allegations of military contractor fraud during the Iraq War from the public, raising concerns that the government may neglect to take action against certain contractors.

"Serious allegations of contractor misconduct should not be hidden from the press and the public," said Sean Moulton, Director of Federal Information Policy at OMB Watch. "The public deserves to know if a contactor has been accused of misusing U.S. taxpayer funds."

The complaint also charges that the secrecy provisions can prevent the public from learning about ongoing threats to public health and safety, since alleged misconduct will remain a secret until the Justice Department takes action and the seal is lifted.

"Hopefully this lawsuit will be a wake up call for the Justice Department. There are circumstances where a confidentiality seal is essential, but Justice has used it as a blanket gag order under threat of criminal prosecution to lock in secrecy sometimes for years. That is defensible for cases solely concerned with financial recovery, but disastrous when a whistleblower challenges fraud that threatens health and safety, such as toxic dumping," said Tom Devine, Legal Director of GAP. "As a result, we must warn those whistleblowers that by filing a False Claims Act lawsuit, they may seal a cover up until it is too late to protect the public. There is no excuse for an effective whistleblower law to degenerate into a statutory gag order. Because Justice has abused its power, either the courts or Congress must act to put freedom of speech back in this whistleblower law."

Today's complaint was filed in the U.S. District Court for the Eastern District of Virginia. Attorneys on the case are Hansen, Mark Ladov and Hina Shamsi of the ACLU and Rebecca Glenberg of the ACLU of Virginia.

The complaint is available online at: www.aclu.org/freespeech/gen/38336lgl20090115.html