Recently, the U.S. Department of Defense (DOD) finalized its Cybersecurity Maturity Model Certification (CMMC) rule. The rule is designed to increase protection of sensitive information in the defense industrial base. The rule requires that one of three levels of cybersecurity requirements be in place in defense contracts and contract solicitations.

The rule will require nearly all DOD contractors to meet minimum cybersecurity requirements. The effort has come in response to an increasing threat of cyberattacks against defense contractors which was putting sensitive, nonpublic information at risk.

How the CMMC could increase fraud

The CMMC will expand the number of defense contractors subject to increased cybersecurity requirements. With the increased number of contracts subject to the CMMC, many government contractors will need to significantly improve their cybersecurity, often at significant cost. These high costs combined with the fact that nearly every DOD contractor will be required to adhere to these rigorous standards means that the potential for companies cutting corners to falsely claim compliance may increase. Failure to meet CMMC requirements but still winning contracts could constitute a violation of the False Claims Act (FCA).

The role of whistleblowers in stopping CMMC fraud

It’s important that firms – no matter the size and whatever the cost – who are entrusted with protecting data take their role as cybersecurity practitioners seriously. That’s because, when data breaches occur, sensitive government data gets leaked, which can be a national security risk. Not to mention, firms who falsify compliance get an unfair advantage over those businesses who do follow the rules. Thus, by helping uncover civil cyber fraud, whistleblowers help protect the country’s security and fiscal health while ensuring the marketplace is fair.

Whistleblowers could be employees or contractors involved in a company’s cybersecurity operations or compliance processes, third-party auditors who certify a company’s compliance, or anyone else with inside knowledge of a company committing fraud to win contracts.

Baron & Budd Whistleblower Attorneys

Baron & Budd’s whistleblower representation team has more than 50 years of experience representing dozens of clients in government fraud cases. They have returned more than $6.0 billion to federal and state agencies with whistleblower recovery shares as high as 50%.

For more information, see What You Need to Know About Becoming a Whistleblower.