Whistleblower Wisdom: Strategies and Guidance from a False Claims Act Attorney

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Denise Alicea

This blog was created by Denise in September 2008 to blog about writing, book reviews, and technology. Slowly, but surely this blog expanded to what it has become now, a central for book reviews of all kinds interviews, contests, and of course promotional venue for authors, etc

If you’ve encountered unsettling information during your employment, such as a series of billing errors, certifications that seem dubious, or evidence that a contract term is being disregarded, you may be grappling with what to do next. Could you step forward as a whistleblower? Should you?

The federal government maintains accountability for businesses and individuals committing fraud against it through a robust law known as the False Claims Act. Due to Washington DC News, if you possess insights into violations of this statute, you could potentially claim a financial reward and safeguards against employer retaliation in exchange for your honesty. While consulting with a qui tam law firm can provide tailored guidance, in many cases, blowing the whistle not only safeguards your professional reputation but can also yield significant financial compensation.

False Claims Act at a Glance

The False Claims Act, also dubbed the Lincoln Law, originated during the American Civil War era. Initially enacted to curb malpractices among early defense contractors supplying substandard provisions to the Union Army, it has evolved into the most potent anti-fraud legislation in the United States. Despite its enactment, some entities persisted in defrauding the government, prompting amendments that fortified its provisions.

Under the False Claims Act, anyone making false certifications or statements to the government can now be held liable for treble damages. Penalties are levied per violation, meaning that cases involving prolonged or recurrent fraud can easily amass into millions of dollars. Operating as a qui tam law, whistleblowers can initiate lawsuits on behalf of the government and potentially recover up to 30% of the government’s total settlement by providing credible and unique information that uncovers fraud.

Whistleblowers are also shielded from employer retaliation and can seek damages through legal recourse if subjected to discrimination due to their disclosure.

What Constitutes a False Claims Act Violation?

A False Claims Act violation must involve federal government funds. Examples include erroneous Medicare claims, defense contractor payments, infrastructure investments, SBA loans, among others. A false claim or certification must be made to evade repayment owed to the government or illicitly acquire funds.

For instance, if a hospital bills Medicare for unperformed tests due to a clerical error, it likely falls short of meeting False Claims Act criteria. However, intentionally neglecting to verify erroneous information or overcharging Medicare as part of a fraudulent billing scheme could render individuals liable under the Act.

Who Can Bring a False Claims Act Lawsuit?

The False Claims Act allows individuals to file lawsuits on behalf of the federal government. While the government is the primary plaintiff, the whistleblower, or qui tam relator, typically initiates the lawsuit.

To file a False Claims Act lawsuit, you must:

  • Possess firsthand knowledge of fraud; mere suspicion is insufficient.

  • Provide previously undisclosed information to federal investigators; previously reported information is ineligible for rewards.

  • Cooperate with federal investigations if the Department of Justice pursues your claim.

You do not need to be a US citizen, act alone, or be employed by the entity you’re reporting.

Who is Liable Under the False Claims Act?

Liability for False Claims Act violations extends to any individual or entity receiving government funding. Common offenders include healthcare providers, pharmaceutical companies, defense contractors, construction firms, and educational institutions.

A mere mistake does not constitute a violation. However, deliberate submission of false claims, willful ignorance of the law, or intentional defrauding of the government can result in liability.

Penalties for Violating the Federal False Claims Act

False Claims Act penalties are substantial, with fines imposed per violation or false claim. These penalties escalate with inflation, with current rates ranging from $13,946 to $27,894.

Rewards for Whistleblowers Under the False Claims Act

Whistleblowers stand to gain significantly from False Claims Act recoveries. Entitled to 15-30% of a successful settlement, whistleblowers can receive substantial payouts, often reaching hundreds of thousands or even millions of dollars.

The percentage awarded depends on various factors, including the value of information provided, cooperation with investigators, and involvement in the fraudulent activity. Whistleblowers who proceed with recovery independently, should the government decline intervention, automatically receive the highest 30% recovery rate.

False Claims Act Statute of Limitations

There is a limited window to report fraud under the Civil False Claims Act. The statute of limitations extends to the longer of either six years from the fraud’s occurrence or three years after a US official, aware of the fraud’s material facts, should have known about it, capped at ten years from the violation.

False Claims Act Whistleblower Protection

The False Claims Act takes whistleblower protection seriously to incentivize disclosures. Under the federal False Claims Act, a whistleblower has the right to sue their employer for damages with interest, including double back pay, reinstatement, and the possibility of front pay should reinstatement not be possible if their employer retaliates against them because of their protected disclosure.

False Claims Act Retaliation

Examples of retaliation that qualify for protection under the False Claims Act include:

  • Firing

  • Demotion

  • Reduction of hours or pay

  • Failure to promote

  • Failure to rehire

  • Suspension

  • Adverse changes to conditions of employment

  • Harassment, marginalization, or assault

What Are the Damages for False Claims Act Retaliation?

The False Claims Act defines damages broadly for employees who have faced discrimination by their employers. According to the statute, whistleblowers are entitled to “all relief necessary to make [them]whole.” 

What this means varies from case to case, as well as how you have been discriminated against. For many whistleblowers, damages often mean reinstatement at the same seniority level as well as double back pay if you were let go. You may also be able to litigate for reasonable attorney fees, compensatory damages for emotional distress, and the cost of filing your lawsuit.

How Can a False Claims Act Lawyer Help?

A False Claims Act lawyer, also known as a whistleblower attorney, is an expert in the ins and outs of the federal False Claims Act and any state laws, SEC and CFTC rules, and other statutes that might apply to your claim. Your qui tam lawyer will be able to advise you about what kinds of evidence can be accepted in the court of law, and which are better left alone. 

You can report anonymously through a qui tam law firm and ensure that you are fully protected against employer retaliation. False Claims Act lawyers with a stellar reputation will have experience working with the Department of Justice and a history of reputable disclosures to convince federal investigators to take on your claim, a tactic that usually increases your overall payout.

A False Claims Act attorney can also ensure that you submit the strongest possible evidentiary support and legal arguments as proof of your claim. Remember, once a disclosure has already been made, it becomes ineligible for a reward. Reporting through a False Claims Act whistleblower attorney is your best shot at ensuring your claim is filed correctly and your professional reputation is protected and defended.

What is an Example of a False Claim Act Case?

False claims act cases can take many forms, from customs liability to pharmaceutical fraud. One recent example of a False Claims Act case is the 2023 settlement with defense contractor Booz Allen over improper billing allegations. The Virginia consultant and contractor agreed to pay $377.45 million to settle allegations that their firm improperly charged the federal government for additional costs that their international and private clients incurred. The whistleblower in this case, a former employee, received $69,828,832 from the settlement.

False Claims Act Lawyer: FAQs

The following are some frequently asked questions about the federal False Claims Act and qui tam litigation:

How successful are False Claims Act cases?

The Department of Justice recovered $2.68 billion in False Claims Act settlements and judgments in Fiscal Year 2023. Out of these recoveries, approximately $1.9 billion was due to action by private whistleblowers. This represents 86% of recovered funds from FY2023.

What is the average settlement for the False Claims Act?

The average settlement for qui tam actions in general hovers around $3.3 million, according to data from the Department of Justice through 2019. The average whistleblower reward is $557,000, according to the same data.

What is the largest False Claims Act settlement?

The largest successful False Claims Act settlement on record is currently $3 billion. GlaxoSmithKline agreed to pay the record-breaking sum for allegations involving pharmaceutical fraud, kickbacks, and false reporting under the Medicaid Best Price Rebate program.

What are the most common situations involving false claims?

The most common example of a False Claims Act case usually involves insurance reimbursement claims and/or pharmaceutical fraud. In FY2023, $1.7 billion was recovered from healthcare fraud out of the total $2.68 billion in DOJ settlements, making it the largest category of false claims recovery.

Does the False Claims Act require intent?

The False Claims Act has a standard of scienter and not intent. You do not have to intend to defraud the federal government to induce liability under the False Claims Act. Instead, knowingly submitting false claims is what creates liability. “Knowing” can also encompass submitting false certifications with willful ignorance or reckless disregard for the truth.

Do you have to have a lawyer to file a False Claims Act lawsuit?

Yes, you have to have a False Claims Act whistleblower attorney to report fraud under the federal False Claims Act. This is to help protect your anonymity and ensure that qualified lawyers are representing the government’s interests in court.

A civil False Claims Act attorney can also help you structure your claim for the greatest chance of success. Qui tam law is a complex area of federal regulation that can also include state liability, employer discrimination, and privacy laws. Knowing what evidence you can submit is extremely important to building your case for federal investigation, and you only have one opportunity to submit information for a reward before it becomes ineligible. Working with a False Claims Act lawyer is necessary and recommended in every whistleblower disclosure case.

Do You Have a Whistleblower Case? Call a False Claims Act Attorney

If you believe you have information that qualifies you to become a False Claims Act whistleblower, speak to a whistleblower attorney. Time is of the essence in reporting your claim and ensuring you receive the maximum possible award from a successful case. Speaking up is not only the right thing to do – it is also in your own best interests.

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