CALIFORNIA and GOVERNOR SCHWARZNEGGAR’S ADMINISTRATION ENGAGED IN MASSIVE FEDERAL FUNDING FRAUD COVER-UP

January 7, 2005 – Press Release

CALIFORNIA and GOVERNOR SCHWARZNEGGAR’S ADMINISTRATION ENGAGED IN MASSIVE FEDERAL FUNDING FRAUD COVER-UP

TMA has investigated California’s Executive Branch and uncovered undeniable evidence that various state agencies have been giving false certifications to the federal government in return for Billion’s of Dollars of federal funding. To “Qualify” for federal funding a state program must be in compliance with federal law. California’s Medicaid program is not only NOT in compliance with federal law, it is committing federal felonies in its every day operation, violating the federally protected rights of Californians who apply for Medicaid assistance in California.

The California Health and Human Services Agency and Department of Health Services are attempting to cover-up fraud associated with Tens of Billions of Dollars of federal funding received by California over the last 30 years. TMA has put the Governor on written notice to cease and desist, but Governor Schwarzneggar has ignored TMA’s demand, and in fact he has not even responded. There are other California state agencies involved in similar fraud, all connected to malfeasance and incompetence within. The next step in the legal process is for TMA to file a “Qui Tam” lawsuit under the federal “False Claims Act” (FCA) to make California pay back several Hundred Billion Dollars to the federal government. The FCA, or “Lincoln Law” [passed in 1863 at the urging of President Lincoln] as some know it, was created to uphold the integrity of the federal government by safeguarding it from fraud. To succeed in a FCA lawsuit there is no legal requirement to prove an “intent to defraud.” Under the FCA the state has immunity, however, certain employees and the local governments do not, and the state programs in question are administered by the local governments. Governor Schwarzneggar is about to bankrupt the California local governments as they do not have the money to pay back the federal taxpayers, much less the statutory treble damages under the FCA.

The Governor’s budget problems are about to take on a new meaning. On May 12, 2004 Governor Schwarzenegger Announced a Local Government Budget Agreement:

“Governor Schwarzenegger, along with local government leaders from around the state, announced a budget agreement that will help alleviate the state's financial crisis while providing long-term financial protection for local governments. ‘With this agreement, I am keeping my promise to cities and counties to ensure that local governments have a reliable revenue stream to pay for local services. This agreement is another example of the new spirit of cooperation and a new respect between state and local governments in California.’”

The Governor’s promise to local governments just went up in smoke as his administration, inclusive of new Finance Director Tom Campbell, has made recent decisions that will soon bankrupt the local governments. The local Governments in California are in serious trouble as they will be charged with repayment of the federal tax money in question as they sanctioned and helped administer the state’s illegal implementation of federally funded programs. TMA’s evidence to support these claims is the state’s own work product, which is impossible to deny. The total amount TMA can force California to repay via the FCA could easily exceed $500,000,000,000.00.

Welcome to Politics Governor!