The government operates many federal programs that distribute money to companies and contractors. This money is intended to cover costs that may include research & development, education, and defense.
These payouts amount to billions of dollars every year, and it is both difficult and expensive for the government to determine whether the funds provided were used for the intended purpose. Fraud occurs when companies or individuals submit false claims to the government in order to collect money for false purposes or for services that were never provided.
Laws exist to fight this fraud, and one of the most important among them is the False Claims Act.