Reporting fraud under the False Claims Act

What is a False Claim under the False Claim Act? Read moreReporting fraud under the False Claims Act

By Jay Holland, Joseph Greenwald & Laake

False Claims Act

Qui tam lawsuits provide a way for whistleblower protection under the False Claims Act, which rewards whistleblowers in cases where the government recuperates funds that have been lost in fraud.

The Department of Justice has successfully used the False Claims Act in order to target bad actors in the financial industry to recover misappropriated government funds. A majority of these cases involve financial institutions that do business in the home mortgage industry. They can also involve Medicare and Medicaid fraud, defense contractor fraud, and others.

False Claims Act Lawsuits

When the government brings a False Claims Act lawsuit, the suit will apply a civil penalty of anywhere between $5,500 and $11,000 for each false payment that the federal government makes, plus three times the amount of damages the government sustains because of the fraudulent claims for payment. Also, as the vast majority of these cases are brought by whistleblowers, called “relators,” under the statute, defendants are also liable for the attorney’s fees and costs incurred by relator’s counsel. Criminal penalties and liability are also possible. When fraud is in play, it may not be too far of a bridge to gap to hold individual bad actors criminally liable.

If you’re considering blowing the whistle, what does this mean for you?

As a private citizen, you may sue an individual or a business for fraud without this lawsuit being leaked to anyone else involved. This sealed lawsuit assures protection to the plaintiff in the cases. If the defendants are found liable, they must pay damages, which can be as much as three times the government’s losses, as well as penalties incurred.

Contact a Qui Tam or False Claims Act lawyer if you are considering blowing the whistle. It takes courage to be a whistleblower, especially when the wrongdoer is your employer. Having a strong advocate will make all the difference.