Maryland Chamber Vice President Ron Wineholt testified today in opposition to SB 215 and HB 292, two bills that would establish additional penalties for the filing of a false claim for state benefits and contracts. The bills would also authorize a person to file suit on behalf of the state for an alleged false claim for state benefits and contracts and recover up to 30 percent of the proceeds of the suit, plus attorney fees and costs.

The Maryland Chamber believes that Maryland should directly prosecute any person who defrauds the state under a benefit program or contract. However, we believe it is inappropriate for the state to create a new private cause of action for the enforcement of state fraud statutes. This type of system will lead to needless litigation and harassment of government contractors by overzealous trial lawyers.

For the past 30 years, Maryland has effectively enforced the fraud statutes through the Medicaid Fraud Control Unit of the Office of the Attorney General. “The Maryland Chamber fully supports enhanced state funding for this unit if the Attorney General needs additional assistance to enforce state laws,” Wineholt said. “However, there is no reason to create a new cause of action for private citizens at the state level to pursue these claims. “