False Claims Act/Qui Tam Litigation and Blowing the Whistle Against Government Fraud

Do you have direct knowledge of fraud on the government and are thinking about blowing the whistle? Congress has enacted laws that reward whistleblowers while preventing retaliation by the bad actor. The False Claims Act imposes significant penalties on those who defraud the government. This involves a number of government programs including Medicare, defense and national security, food safety and inspection, federally-insured loans and mortgages, highway funds, small business contracts, agricultural subsidies, and disaster assistance.

Since those who defraud the government often hide their misconduct from the public view, whistleblowers are often essential to uncovering the truth. This person is called a “relator.” Often, a relator may be an employee or a former employee of a company committing the fraud, or a contractor or subcontractor who discovers a fraud on the government. A relator’s claims cannot be filed based just on publicly available information, rather, a relator must have some direct, first-hand knowledge of the fraud, even if he/she did not participate directly in the fraud.

Unlike most civil lawsuits, a complaint is filed under seal with the court. While the complaint is under seal, neither the bad actor nor the public knows of the case. During this time, the Department of Justice may investigate the claim. The government may decide to intervene in the case or it may decline in prosecuting the case, in which case a relator may proceed with his/her claim. To reward a relator for reporting the fraud on the government, the False Claims Act provides awards of 15 to 30 percent of any recovery that the government receives if the case is successful.

For states that have a state false claims statute, this applies to fraud on state governments as well. Under some circumstances, such as in New Jersey for example, presenting a claim to an agent of the government or to a contractor or other recipient of state funds may trigger a violation of a state false claims act.

Don’t guess. Be sure. If you choose to blow the whistle against government fraud, call the attorneys experienced in False Claims Act litigation at Saltz, Mongeluzzi & Bendesky, P.C. at 215-575-3985 to confidentially evaluate your potential case; walk you through the requirements of the False Claims Act; and to maximize your ability to obtain a reward for reporting government fraud while protecting you from the possibility of retaliation. Until then, it is important not to discuss the matter with anyone other than your attorney, as doing so may jeopardize your ability to recover under the False Claims Act.