A summary of the False Claims Act

On March 2, 1862, President Abraham Lincoln signed into law the False Claims Act. It has since become one of the most successful anti-fraud laws in the U.S. Damages were substantially increased when the law was amended in 1986. A central feature of the FCA is its whistleblower, or qui tam, provisions. Any person or non-government entity is allowed to file a lawsuit against the company engaging in fraudulent activity on behalf of the U.S. government. When a claim is filed, the government is required to thoroughly investigate. It can then either intervene and proceed or decline to do so. If the government declines, the whistleblower is then allowed to move forward with the lawsuit.

Since 1986, the government has recovered more than $48 billion under the False Claims Act, of which more than $33 billion was recovered through whistleblower cases. Whistleblowers are able to receive substantial amounts of negotiated settlements as awards. These cases play instrumental roles in fighting international corruption as well as fraudulent behavior within the country.

The Dodd Frank Act and other whistleblower laws

In 2010, the federal government enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act, a financial reform law commonly known as the Dodd Frank Act. Under this act, whistleblowers who give the Commodity Futures Trading Commission or the Securities and Exchange Commission information about violations of federal securities laws and regulations may be rewarded if the government acts on the provided information. In these types of whistleblower cases, the recovery for the whistleblowers ranges from 10 to 30 percent.

The Internal Revenue Service also has a whistleblower provision allowing for people to report tax fraud. Finally, most states have their own whistleblower statutes, meaning that state losses might also be actionable.

Who can be a whistleblower?

Under the False Claims Act’s qui tam provision, a person or people may sue wrongdoers and act as whistleblowers on behalf of the government. In those cases, whistleblowers are called relators and their lawsuits are called qui tam lawsuits. Whistleblowers who are successful with their cases are entitled to receive a percentage ranging from 15 to 30 percent of the total amount that the government collects as a result.

Any entity or person who has evidence of a company committing fraud against the government may be a whistleblower under the provisions of the False Claims Act. Under Dodd-Frank, people who report securities violations to the Securities and Exchange Commission may also serve as whistleblowers.

Types of whistleblower claims and rights

As discussed, there are multiple state and federal whistleblower laws that allow whistleblowers to notify the authorities or sue employers for illegal conduct. The type of claim that is filed depends on the specific conduct and the agency to which it is reported. Your whistleblower lawyer at Swartz Swidler may help with identifying the appropriate agency and the type of claim to file.

Separate from whistleblower lawsuits, retaliation claims involving whistleblowers are related cases that are common. Retaliation cases provide whistleblower protection when employers engage in adverse employment actions in retaliation for the person’s acting. Generally, employees who report illegal activity or who cooperate with investigations of their employers are protected under anti-retaliation laws. If your employer has engaged in retaliatory actions against you for engaging in legally protected activities, your whistleblower attorneys at Swartz Swidler may file a retaliation case on your behalf.

Contact Our False Claims Act attorneys

If you are aware of illegal activity in which your company has engaged, you may want to talk to the False Claims Act attorneys at Swartz Swidler. We may help you to file a lawsuit against the company for committing governmental fraud. We may also file a retaliation lawsuit on your behalf if your employer engages in retaliation against you for reporting it. Call us today for your free consultation.