The United States Department of Justice (“DoJ”) has issued its report on False Claim Act actions for 2025.

The False Claims Act (FCA), 31 U.S.C. § 3729, prohibits federal contractors and others from defrauding the government through the submission of false claims that cause the government to pay too much or receive too little. The federal government is normally the party that asserts FCA claims. When they succeed, the government may recover both the actual damages suffered, plus treble damages and fines.

The FCA also permits any “person,” referred to as a relator, to bring a claim in the name of the United States. After such a party files a complaint, the government may choose to intervene as a plaintiff in the action, which transfers control to the government. If the government declines to intervene, the relator may proceed with prosecution, including any appeals, without having to consult with or take direction from the government. If the relator succeeds with the claim, they may collect up to thirty percent of the judgment as an award.

In 2025, the DoJ brought 401 FCA actions on its own, and 1,297 FCA qui tam actions were brought. Also in 2025, the DoJ recovered $1,548,089,931 in judgments and settlements on DoJ initiated FCA claims, while FCA qui tam actions recovered $5,340,006,336. Of that $5,340,006,336 in FCA qui tam actions, the relators (i.e., whistleblowers who initially brought the claim) received $330,358,218 in awards.

The Department of Health and Human Services was the primary source of FCA claims, with a total of 641 FCA claims brought in 2025, and $60,009,541,315 in recoveries. The DoD had 66 FCA claims brought in 2025, and $633,927,500 in recoveries.

In a fact sheet accompanying its report, the DoJ announced several significant settlements addressing fraud and compliance failures in government contracting. Here are the key takeaways for contractors:

Pricing and Billing Integrity Matters

Major defense contractors paid substantial penalties for pricing violations:

• • Raytheon ($428M) – False cost and pricing data, double-billing
  • L3 Technologies ($62M) – Inaccurate cost data on communications equipment
  • Lockheed Martin ($29.74M) – Defective pricing on F-35 contracts

The lesson: Ensure cost and pricing data is accurate, current, and complete. The Truth in Negotiations Act has real teeth.

Procurement Ethics and Conflicts

Booz Allen Hamilton ($15.875M) settled allegations that employees improperly used confidential government and competitor information to influence contract awards.

DynCorp International ($21M) allegedly passed through inflated subcontractor charges for Iraqi police training contracts.

Cybersecurity Compliance Is Non-Negotiable

Several contractors settled for failing to meet cybersecurity requirements:

• • Health Net Federal Services ($11.2M) – Failed vulnerability scanning and remediation
  • Illumina ($9.8M) – Sold systems with known vulnerabilities
  • MORSECORP ($4.6M) – Inadequate security controls, inaccurate reporting

Even educational institutions weren’t exempt, Penn State and Georgia Tech paid $1.25M and $875K, respectively for cybersecurity failures.

These cases underscore the DOJ’s focus on contractor accountability. Major primes and small businesses alike should ensure compliance systems are robust, pricing is defensible, and cybersecurity controls meet contract requirements.

This article summarizes aspects of the law and opinions that are solely those of the authors. This article does not constitute legal advice. For legal advice regarding your situation, you should contact an attorney.