In federal healthcare fraud investigations and other federal cases targeting partnerships and corporate entities, one of the biggest questions for company owners is “Am I at risk of being held personally liable?” While the best-case scenario is to avoid liability all together, if any liability is going to be imposed, for obvious reasons, it is far better for a settlement or judgment to involve a business entity rather than the business’s owners.<\/p>\n
However, in 2015, the U.S. Department of Justice (DOJ) issued a memorandum in which it outlined a new strategy of targeting individuals in cases of corporate fraud. According to the memorandum entitled Individual Accountability for Corporate Wrongdoing<\/a>, the DOJ’s current position is that:<\/p>\n “One of the most effective ways to combat corporate misconduct is by seeking accountability from the individuals who perpetrated the wrongdoing. Such accountability is important for several reasons: it deters future illegal activity, it incentivizes changes in corporate behavior, it ensures that the proper parties are held responsible for their actions, and it promotes the public’s confidence in our justice system.”<\/em><\/p>\n Since issuing the memorandum, the DOJ has stayed true to form. Over the past few years, we have seen a significant increase in the number of federal fraud cases targeting business owners, including specifically the owners of medical practices and other healthcare businesses. In one case decided earlier this year, a federal jury imposed personal liability in the amount of $51 million on three individuals found guilty of being personally involved in a corporate Medicare and Tricare fraud scam. According to a DOJ press release<\/a>, the three co-conspirators had each been personally involved in the payment of “illegal kickbacks to physicians across the country in order to get them to order medically unnecessary blood tests . . . in violation of the Anti-Kickback Statute and the False Claims Act<\/a>.”<\/p>\n\n\n