GAO-12-275R Program Fraud Civil Remedies Act

United States Government Accountability Office

Washington, DC 20548

January 27, 2012 

The Honorable Darrel E. Issa

Chairman 

The Honorable Elijah E. Cummings

Ranking Member

Committee on Oversight and Government Reform

House of Representatives 

Subject: Program Fraud Civil Remedies Act: Observations on Implementation

This letter formally transmits the slides used at a briefing we presented to staff from 

your offices in response to your request for information about federal executive 

agencies’ recent use of the Program Fraud Civil Remedies Act of 1986 (PFCRA).

1

 (See 

enclosure for a copy of our briefing slides). PFCRA provides an administrative 

remedy available to federal executive branch agencies to address false, fictitious, or 

fraudulent claims and statements (false claims). PFCRA can be used for false claims 

where the alleged liability is less than $150,000 (claim ceiling). It also provides for 

monetary penalties up to $5,000 (a cap that most agencies are to adjust upward for 

inflation2) and allows for an assessment of up to two times the amount of the 

fraudulent claim. In addition to PFCRA, federal agencies also use other mechanisms

to address false claims, such as the False Claims Act,3 suspension and debarment 

processes, and statutes that address Medicaid and Medicare false claim frauds 

through the Social Security Act, as amended.4

In 1991, we reported that federal agencies did not use PFCRA extensively.

 

5

 

1

31 U.S.C. Chapter 38. 

 You 

asked us to provide recent information on federal agencies’ use of PFCRA. As 

discussed with your staff, our objectives were to present information on (1) the 

extent to which federal agencies have used PFCRA in recent years, (2) factors 

2

The Federal Civil Penalties Inflation Adjustment Act (28 U.S.C. § 2461 note) provides a mechanism to 

allow for regular adjustment (once every four years) for inflation of civil monetary penalties 

established in law. The monetary penalty in PFCRA would be subject to adjustment by this Act. 

However, agencies made initial adjustments to the PFCRA penalty cap at different times causing 

agencies to have varying penalty caps. For example, the Department of Housing and Urban 

Development reported adjusting its PFCRA cap to $7,500 in fiscal year 2009, and the Department of 

Energy reported adjusting its cap to $8,000 in fiscal year 2010. 3

The False Claims Act is codified at 31 U.S.C. § 3729-33. 4

42 U.S.C. § 1320a-7a. 5

GAO, Program Fraud: Implementation of the Program Fraud Civil Remedies Act of 1986, 

GAO/AFMD-91-73 (Washington, D.C.: Sept. 13, 1991).
Page 2 GAO-12-275R Program Fraud Civil Remedies Act

reported by agency officials and inspectors general (IG) that either facilitated or 

limited the use of PFCRA, and (3) views of federal agency IGs on prior 

recommendations made by the National Procurement Fraud Task Force on possible 

PFCRA reforms. 6

To obtain information about the recent use of PFCRA by federal agencies, we 

selected the most recent 5-year period for which data were available–-fiscal years 

2006 through 2010. We interviewed Department of Justice (DOJ) officials concerning 

the PFCRA cases they received during this period, and summarized responses from 

the statutory federal IGs we surveyed in May 2011, which included the extent to 

which their agencies’ used PFCRA’s civil program fraud remedies and any factors 

that limited their agencies’ use of PFCRA.

7

We performed our work from February 2011 through January 2012 in accordance 

with all sections of GAO’s Quality Assurance Framework that are relevant to our 

objectives. The framework requires that we plan and perform the engagement to 

obtain sufficient and appropriate evidence to meet our stated objectives and to 

discuss any limitation in our work. We believe that the information and data obtained, 

and the analysis conducted, provide a reasonable basis for any findings and 

conclusions. We provided your staff with a briefing covering the above information in 

a previous meeting. This letter transmits the updated materials used for that briefing.

 We also obtained information about 

factors that either facilitated or limited federal agencies’ use of PFCRA’s provisions

by interviewing officials responsible for addressing false claims at the Departments of 

Housing and Urban Development (HUD), Defense (DOD), and Health and Human 

Services (HHS). We selected these agencies because they represented a range of 

characteristics that may affect PFCRA usage. We also summarized responses to our 

May 2011 survey concerning federal agency IGs’ views on prior recommendations 

made by the National Procurement Fraud Task Force on possible PFCRA reforms. 

In summary, according to information provided by DOJ and our survey of the IGs, 

five civilian agencies (HUD, HHS, Department of Energy, the Corporation for 

National and Community Service, and the Nuclear Regulatory Commission) used 

PFCRA’s authorities to refer 141 cases to DOJ for approval by the Attorney General 

during fiscal years 2006 through 2010. Of the 141 cases, 135, or 96 percent, were 

referred by HUD. The remaining four agencies referred a total of 6 cases during this 

period. 

We asked HUD IG officials to identify factors that facilitated HUD’s use of PFCRA. 

They told us that HUD’s use of PFCRA was the result of several factors; including the 

support of HUD’s top management, applying PFCRA penalties to already successful 

criminal prosecutions, proactive HUD IG office involvement, coordination within 

HUD and with DOJ, use of standardized PFCRA case documentation, and a PFCRA 

case tracking system. In contrast, officials from other agencies that did not use 

PFCRA’s administrative remedies identified several factors that limited their ability to 

use PFCRA. These factors included available alternative mechanisms to PFCRA that 

 

6

The Department of Justice, National Procurement Fraud Task Force, Legislation Committee, 

recommended possible PFCRA reforms in its June 9, 2008, report, Procurement Fraud: Legislative 

and Regulatory Reform Proposals. 7

As of May 2011, there were 73 IG offices established by the IG Act of 1978, as amended, or other 

statutes. Seventy-one IGs provided responses to our survey questions regarding their agencies’ use of 

PFCRA but provided a limited response to our questions regarding factors that limited the use of 

PFCRA and their views on prior recommendations to reform PFCRA.
Page 3 GAO-12-275R Program Fraud Civil Remedies Act

agency officials found more useful in addressing false claims and related fraud, and a 

PFCRA requirement for their agency to use Administrative Law Judges (ALJ), which 

are not available at DOD, to preside over PFCRA cases. On average, DOJ’s reviews of 

PFCRA cases took 211 days rather than 90-days as prescribed by PFCRA. DOJ 

officials told us this was due to several factors including (1) other high-dollar cases 

that often took precedence over PFCRA cases and (2) time for DOJ follow-up with 

the referring agencies to obtain necessary information. In their comments identifying 

factors that limited the use of PFCRA, DOJ officials also cited the requirement for 

PFCRA cases to be approved by the Attorney General or a designated Assistant 

Attorney General, instead of a director-level official who may approve other fraud 

cases involving similar dollar amounts. In our May 2011 survey, 39 IGs included these 

and additional factors that limited use of PFCRA. The IGs most often cited the use of 

alternative mechanisms to address false claims and resource constraints as factors 

limiting PFCRA use. The other limiting factors they identified included that penalty 

amounts recovered by the agencies, with few exceptions, are to be sent to the U.S. 

Treasury rather than retained by the agency; the false claims ceiling and penalty 

amounts are too low; the PFCRA process is too cumbersome; and there is a lack of 

available ALJs. Further, the IGs noted that regulatory agencies have few issues with 

false claims.

Most IGs who responded to our May 2011 survey with an opinion agreed with the 

National Procurement Fraud Task Force recommendations for reforming PFCRA. 

For the recommendation that agencies be allowed to retain their PFCRA-related 

monetary recoveries, 51 of the 53 IGs in our survey who had an opinion agreed with 

this reform. While the support for the remaining recommendations was not as strong, 

the IGs who provided an opinion generally supported the other five proposals as well.

We received technical comments on a draft of this report from officials we 

interviewed and made changes as appropriate. These officials were from DOJ, HUD 

IG office, HHS IG office, U.S. Army, U.S. Air Force, Defense Logistics Agency, 

Defense Contract Management Agency, Special IG for Iraq Reconstruction, and 

additional IGs in the Council of the IGs on Integrity and Efficiency (CIGIE). We are 

also providing copies of this report to these officials and all the IGs in CIGIE. 

------------

If you have any questions or would like to discuss this report, please contact me at 

(202) 512-8486 or raglands@gao.gov. Contact points for our Offices of Congressional 

Relations and Public Affairs may be found on the last page of this report. Key 

contributors to this letter and the enclosure were Jackson Hufnagle, Chris Yfantis, 

Clarence Whitt, Tyrone Hutchins, Quang Nguyen, Rebecca Shea, Jacquelyn Hamilton, 

and Katherine Lenane. 

Susan Ragland

Director 

Financial Management and Assurance 

Enclosure
Page 4 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 1

Program Fraud Civil Remedies Act: 

Observations on Implementation 

Briefing for Staff Members of the Committee on

Oversight and Government Reform 

House of Representatives
Page 5 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 2

Overview

• Introduction

• Objectives 

• Scope and methodology

• Background

• Results

• Agencies’ use of the Program Fraud Civil Remedies Act (PFCRA) during 

fiscal years 2006 through 2010

• Factors reported by agency officials and inspectors general (IG) that 

facilitated or limited the use of PFCRA

• IGs’ views on recommendations of the National Procurement Fraud Task 

Force for possible PFCRA reforms1

1The Department of Justice, National Procurement Fraud Task Force, Legislation Committee, recommended PFCRA reforms in its June 9, 2008, report, 

Procurement Fraud: Legislative and Regulatory Reform Proposals.
Page 6 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 3

Introduction

• The Program Fraud Civil Remedies Act of 1986 (PFCRA) (31 U.S.C § 3801-

3812) created one of several mechanisms executive branch agencies have 

available to address false, fictitious, or fraudulent claims or statements.

• Cap of $150,000 on the amount of claim (or group of related claims)

• Civil penalties of up to $5,000 (adjusted for inflation)2 for each false claim or 

statement with assessments of up to double the amount falsely claimed in 

cases where federal payment has been made

• Dollar recoveries collected from PFCRA cases are returned to the General 

Fund of the U.S. Treasury

• We had previously reported that federal agencies did not use PFCRA 

extensively.3 You asked us to provide information on federal agencies’ recent 

use of PFCRA.

2The Federal Civil Penalties Inflation Adjustment Act (28 U.S.C. § 2461 note) provides a mechanism to allow for regular adjustment (once every four years) for 

inflation of civil monetary penalties established in law. The monetary penalty in PFCRA would be subject to adjustment by this act. However, agencies made 

initial adjustments to the PFCRA penalty cap at different times causing agencies to have varying penalty caps. For example, the Department of Housing and 

Urban Development adjusted its civil penalty cap under PFCRA to $7,500 in fiscal year 2009, and the Department of Energy adjusted its cap to $8,000 in fiscal 

year 2010.

3GAO, Program Fraud: Implementation of the Program Fraud Civil Remedies Act of 1986, GAO/AFMD-91-73 (Washington, D.C.: Sept. 13, 1991).
Page 7 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 4

Objectives

• As agreed with committee staff, our objectives were to provide 

information on the recent use of PFCRA throughout the federal 

government. Specifically, we obtained information reported by 

federal executive branch agencies and IG officials on:

• The extent to which they have used PFCRA in recent years

• The factors they reported that either facilitated or limited their 

use of PFCRA, and

• The views of the IGs on prior National Procurement Fraud 

Task Force recommendations to reform PFCRA.
Page 8 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 5

Scope and Methodology

• To obtain information about the use of PFCRA, we reviewed the act’s 

requirements and our 1991 report on the implementation of PFCRA.

• To determine the extent to which federal agencies reported they have 

used PFCRA in recent years, we obtained data from the Department of 

Justice (DOJ) on PFCRA cases federal agencies referred for approval in 

fiscal years 2006 through 2010. 

• Through coordination with the Council of the IGs on Integrity and 

Efficiency (CIGIE), we surveyed 71 statutory IGs in May 2011 about 

their agencies’ use of PFCRA during fiscal years 2006 through 2010.4

4CIGIE was establish by the IG Reform Act of 2008 (Pub. L. No. 110-409, 122 Stat. 4302, Oct. 14, 2008) to address integrity, economy, and

effectiveness issues that transcend individual government agencies and to increase the professionalism and effectiveness of personnel in the IG

offices.
Page 9 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 6

Scope and Methodology

• We obtained further information on the factors that facilitated or limited 

federal agencies’ use of PFCRA by interviewing officials from the 

Departments of Housing and Urban Development (HUD), Defense 

(DOD), and Health and Human Services (HHS) responsible for 

addressing false claims against their agencies. 

• We selected these agencies because 

• HUD used PFCRA extensively during our period of review; 

• DOD does not have administrative law judges (ALJ), which are a 

required component for presiding over PFCRA cases at DOD; 

and 

• HHS addressed false claims using alternative remedies provided 

by statutes specific to the Medicare and Medicaid programs. 
Page 10 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 7

Scope and Methodology

• Specifically, these interviews included officials at the following agencies:

• Department of Justice (DOJ) Commercial Litigation Branch

• Department of Housing and Urban Development Office of Inspector 

General (HUD IG)

• Department of Health and Human Services Office of Inspector 

General (HHS IG)

• U.S. Air Force, General Counsel for Contractor Responsibility

• U.S. Army, Procurement Fraud Branch, Contract and Fiscal Law 

Division, Legal Services Agency

• Defense Contract Management Agency, Contract Integrity Center

• Defense Logistics Agency, General Counsel, Contract Integrity

• Special Inspector General for Iraq Reconstruction, IG Counsel

• In response to our May 2011 survey, the IGs identified factors that 

limited the use of PFCRA at their agencies.
Page 11 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 8

Scope and Methodology

• To obtain IG views on the National Procurement Fraud Task Force’s 

proposed recommendations to reform PFCRA, we included a listing of 

these recommendations in our May 2011 survey of the IGs to determine 

the extent to which they agreed with these reforms.

• We conducted our work from February 2011 through January 2012 in 

accordance with all sections of GAO’s Quality Assurance Framework 

that are relevant to our objectives. The framework requires that we plan 

and perform the engagement to obtain sufficient and appropriate 

evidence to meet our stated objectives and to discuss any limitations in 

our work. We believe that the information and data obtained, and the 

analysis conducted, provide a reasonable basis for any findings and 

conclusions. 
Page 12 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 9

Background: PFCRA Provisions

• Provides federal executive branch agencies with an 

administrative remedy for small-dollar fraud cases for false 

claims and statements.

• Liability of accused party alleged to have made, presented, 

or submitted false, fictitious, or fraudulent claims or 

statements is determined during administrative proceedings 

by federal executive branch agencies’ ALJs or other 

qualified individuals authorized under PFCRA to be a 

presiding official.
Page 13 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 10

Background: PFCRA Roles and Responsibilities 

• Investigating Official—Agency IGs or designated investigating official initiates investigations of false claims or allegations.

• Reviewing Official—Generally, the agency General Counsel reviews the findings of the Investigating Official and forwards the case to DOJ for approval.

• Department of Justice—Attorney General or designated Assistant Attorney General reviews the PFCRA case for Attorney General approval within 90 days.

• Accused Party—The accused party can settle the case at any time or has 30 days after receiving notification of an allegation from the reviewing official to 

request a hearing.

• Presiding Official—An ALJ (or other presiding official authorized under PFCRA) presides over the hearing and decides the outcome of PFCRA cases 

and the penalty and/or assessment imposed.

• Agency Head—Promulgates regulations, designates other officials, and considers appeals made by an accused party. 
Page 14 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 11

Background: PFCRA Process
Page 15 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 12

Background: Alternative Mechanisms Agencies 

Use to Address False Claims 

• In addition to PFCRA, federal agencies use other mechanisms to 

address false claims.

• The False Claims Act (31U.S.C. § 3729) differs from PFCRA in that it provides a judicial remedy rather than an administrative process. 

It can be used against any person who knowingly submits false 

claims to the federal government and provides for penalties not less 

than $5,000 and not more than $10,000 plus possible triple 

damages (three times the amount of damages sustained by the 

government unless the person qualifies for reduced damages 

stipulated in the act).5

• DOJ reported recoveries of approximately $3 billion in false claims 

cases in fiscal year 2010, with $2.5 billion, or 83 percent, 

attributable to health care fraud civil recoveries.

5Pursuant to the Federal Civil Penalties Inflation Adjustment Act (28 U.S.C. § 2461 note) DOJ has adjusted the civil penalty range available under the False Claims Act to a minimum penalty of $5,500 and a maximum penalty of $11,000.
Page 16 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 13

Background: Alternative Mechanisms Agencies 

Use to Address False Claims

• Suspension and debarment mechanisms prohibit contractors from 

obtaining future government contracts for various reasons, such as 

conviction of or indictment for certain offenses, or a serious failure to 

perform to the terms of a contract. These mechanisms differ from 

PFCRA in that the government’s interests are protected by preventing 

future business with the offender as compared to recouping some 

monetary value for the damages sustained from the actual offense.

• More specifically, for suspensions and debarments:

• A suspension is a temporary exclusion of a contractor pending the 

completion of an investigation and any ensuing legal proceedings. 

• A debarment is a fixed-term exclusion that generally shall not 

exceed 3 years. 
Page 17 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 14

Background: Alternative Mechanisms Agencies 

Use to Address False Claims 

• The Social Security Act allows civil monetary penalties as well as 

enforcement procedures for Medicaid and Medicare fraud cases (42 

U.S.C. § 1320a-7a). This authority provides that: 

• $10,000 may be recovered for each medical service improperly 

claimed

• $50,000 may be recovered for each violation of anti-kickback 

statutes

• $100,000 may be recovered per scheme under the physician selfreferral laws

• Penalties collected are to be retained by the appropriate program’s 

trust funds

• Violators can be excluded from participation in the federal health 

care programs
Page 18 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 15

Background: 1991 GAO Report

• In our prior report we reported that eight federal agencies had used PFCRA during the 

period October 21, 1986 through September 30, 1990. In addition, we reported that 

PFCRA was not used more often because the cost to implement PFCRA exceeded the 

potential recoveries and the procedural requirements were cumbersome. The following 

agencies referred a total of 41 PFCRA cases to DOJ during the period:

• U.S. Postal Service 

• Department of Labor

• DOD

• HUD

• HHS

• Department of Transportation

• General Services Administration

• Department of Veterans Affairs6

6The Department of Veterans Affairs had implemented PFCRA but had not referred any cases to DOJ.
Page 19 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 16

Background: IGs’ Views on Prior 

Recommendations to Reform PFCRA

• In April 2009 congressional testimony, the Chairman of the Legislation 

Committee of CIGIE discussed the IGs’ views on the National 

Procurement Fraud Task Force recommendations for possible PFCRA 

reforms.7 

• These included the following:

• Update the dollar limit on the PFCRA claims ceiling from 

$150,000 to $500,000 and allow agencies to retain PFCRA 

monetary recoveries to the extent needed to make them whole.

• Allow IGs the discretion to prosecute PFCRA claims themselves 

rather than referring them to their agencies’ general counsel, and 

permit greater delegation within DOJ to authorize PFCRA claims.

7CIGIE, Improving the Ability of Inspectors General to Detect, Prevent, and Help Prosecute Contracting Fraud, statement of J. Anthony Ogden, IG, U.S. 

Government Printing Office, before the Contracting Oversight Subcommittee of the Senate Committee on Homeland Security and Governmental Affairs 

(Washington, D.C.: April 21, 2009).
Page 20 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 17

Agencies’ Use of PFCRA

• As shown in table 1, only five agencies referred PFCRA 

cases to DOJ during fiscal years 2006 through 2010

• During this period a total of 141 PFCRA cases were 

referred to DOJ

• HUD referred 135 PFCRA cases, or 96 percent of 

all cases

• Three agencies each referred one PFCRA case

• One agency referred three PFCRA cases
Page 21 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 18

Agencies’ Use of PFCRA

Table 1: PFCRA Cases Referred to the Department of Justice,

Fiscal Years 2006 through 2010

Department or Agency 2006a 2007 2008 2009 2010 Total

Housing and Urban Development 11 37 32 33 22 135

Corporation for National and 

Community Service 1 2 3

Energy 1 1

Health and Human Services 1 1

Nuclear Regulatory Commission 1 1

Totals 11 38 34 34 24 141b

Source: GAO analysis of case files reported by the Department of Justice.

aOnly partial year FY 2006 data are available due to the lack of complete DOJ records for this year. 

bAccording to DOJ officials, all but four PFCRA cases referred to DOJ were ultimately approved. These four cases were from HUD.
Page 22 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 19

HUD Officials Reported Factors That Facilitated 

Their Use of PFCRA

• According to HUD IG officials, HUD’s top management supported pursuing 

PFCRA cases through HUD’s Office of Program Enforcement and HUD’s 

Associate General Counsel, who has wide latitude to determine which cases to 

prosecute and which remedy, including PFCRA, works best. According to these 

HUD officials, several additional factors facilitated the use of PFCRA including:

• Applying PFCRA to previously completed successful criminal prosecutions 

required little additional review, and HUD’s ALJs have the expertise and 

resources to preside over PFCRA hearings and render decisions

• Proactive involvement by the HUD IG’s office including attorney assistance 

to identify potential PFCRA cases, and additional training on PFCRA

• Close coordination within HUD between the HUD IG (Investigating Official) 

and the Office of General Counsel (Reviewing Official), and between HUD 

and DOJ prior to referral

• A standardized case documentation format for potential PFCRA cases with 

fully developed supporting documents

• A PFCRA case tracking system through the use of a database
Page 23 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 20

Agency Officials Reported Factors That Limited 

the Use of PFCRA

• DOJ officials identified the following limitations to using PFCRA:

• Excessive time required to process PFCRA cases. For fiscal years 2006 

through 2010, DOJ took 211 days on average to approve agencies’ PFCRA 

cases, which exceeds the 90-day approval required by PFCRA. According 

to DOJ officials, some reasons for the delays include:

• High-dollar cases take precedence over PFCRA cases

• Time for follow-up with the referring agency to obtain all necessary information

• The 211 day average to approve PFCRA case referrals was based on 

the date of the agencies’ referrals and not the date DOJ receives them

• The Attorney General or designated Assistant Attorney General is required 

to approve PFCRA cases, whereas similar small-dollar cases reviewed 

under the False Claims Act may be approved by a DOJ director, which 

takes less time

• Under fraud statutes other than PFCRA, the statute of limitations can be 

suspended, or tolled, by filing a case. However, for PFCRA cases a hearing 

must be scheduled to toll the statute
Page 24 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 21

Agency Officials Reported Factors That Limited 

the Use of PFCRA

• DOD officials stated that they do not use PFCRA but instead use 

alternative mechanisms such as suspension and debarment and the 

False Claims Act due to the following reasons:

• DOD does not have dedicated ALJs, which are required by PFCRA 

to preside over DOD cases

• For DOD, PFCRA limits the investigating role solely to the IG office. 

DOD officials stated that investigations leading to alternative 

remedies can be performed by DOD investigators not in the IG 

office allowing a more flexible process

• Much of the HHS Secretary’s authority under the Social Security Act to 

seek civil monetary penalties has been delegated to the HHS IG. HHS 

IG officials told us they prefer this authority because it allows greater 

monetary penalties than under PFCRA, includes exclusions of health 

care providers, and allows the penalties to be retained by the 

appropriate program’s trust funds
Page 25 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 22

IGs Reported Factors That Limited the 

Use of PFCRA

• As discussed previously, only five agencies used PFCRA’s 

administrative remedies in the past 5 years. IGs responding 

to our May 2011 survey were asked why PFCRA was not 

generally used. As summarized in table 2, 39 of the 71 IGs 

surveyed included a variety of factors limiting PFCRA’s use.
Page 26 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 23

IGs Identified Factors That Limited the 

Use of PFCRA

In response to our May 2011 survey, 39 IGs included factors that limited the use 

of PFCRA.

Table 2: Identified factors that limited the use of 

PFCRA

Number of IGs who 

identified limitations

Use of alternative processes for false claims 15

Limited resources to implement PFCRA 10

Penalty amounts sent to U.S. Treasury, not the agency 9

PFCRA false claims ceiling/penalty amount is too low 9

PFCRA process is too cumbersome 9

Regulatory agencies have few issues with false claims 7

Lack of available administrative law judges 6

Source: GAO analysis of IG responses on the reasons for their limited use of PFCRA were obtained from our May 2011 survey of 71 IGs. The remaining IGs

described limitations unique to their agencies or did not respond. 
Page 27 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 24

IGs’ Views on Prior Recommendations to Reform 

PFCRA

• Given that only five agencies used PFCRA’s provisions in 

the last 5 years, it is not surprising that many IGs were 

undecided as to whether they agreed with the National 

Procurement Fraud Task Force’s recommended PFCRA 

reforms. As summarized in table 3, the majority of IGs 

providing “yes” or “no” responses to our survey questions 

regarding their agreement with the proposed PFCRA 

reforms, were in agreement. 
Page 28 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 25

IGs’ Views on Prior Recommendations to Reform 

PFCRA

Table 3: IGs’ Views to National Procurement Fraud Task Force recommendations 

Questions concerning prior 

recommendations Yes No Undecided No answer

Should penalty amount be changed? 27 6 33 5

Should claim amount be changed? 37 4 25 5

Should the IG be able to refer PFCRA 

cases directly to DOJ without going 

through the reviewing official?

38 5 22 6

Should agencies retain recoveries? 51 2 13 5

Should the definition of presiding officer be 

amended to include agency boards of 

contract appeals or military judges?

20 3 40 8

Would you use PFCRA more if the claim 

ceiling and/or penalty amounts increased? 24 17 24 6

Source: GAO analysis of Information obtained by our May 2011 survey of the IGs.
Page 29 GAO-12-275R Program Fraud Civil Remedies Act

Enclosure 

Page 26

GAO on the Web

Web site: http://www.gao.gov/

Contact

Susan Ragland, Director, Financial Management and Assurance, at 

(202) 512-8486 or raglands@gao.gov.

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U.S. Government Accountability Office, 441 G Street NW, Room 7149 

Washington, DC 20548

GAO’s Mission

Obtaining Copies of 

GAO Reports and 

Testimony

Order by Phone

To Report Fraud, 

Waste, and Abuse in 

Federal Programs

Congressional 

Relations

Public Affairs