Under the whistleblower reward laws, a whistleblower claim is a formal submission or complaint that exposes and describes certain types of alleged fraud or misconduct. There are different types of whistleblower claims depending on the arena of fraud. If you have the right kind of information about a fraud or misconduct under an applicable whistleblower reward program, you may have a whistleblower case. You can read more on our page I Think I Have a Whistleblower Case.
The victim(s) harmed and the specific government agency involved typically determine the type of case. If the misconduct caused financial loss to the government, you might have a case under the federal False Claims Act or a state False Claims Act. Such cases include Medicare and other healthcare fraud, or government contracts and programs. If investors are harmed or there is financial impropriety, you could have an SEC or CFTC case. For taxpayer fraud, an IRS matter. There is even a law for certain whistleblowers exposing auto safety defects.
For more information and specific examples, we recommend our page I Think I Have a Whistleblower Case.
The False Claims Act is the foundation of the U.S. whistleblower system. It is by far the most commonly used statute employed by whistleblowers to report fraud or misconduct against the government. It allows private citizens, known as relators, to bring a whistleblower lawsuit on the government’s behalf and rewards them with a significant portion of any government recovery (anywhere from 15-30%). The key factor in determining whether conduct is covered by the False Claims Act is whether that conduct caused the government to suffer a financial loss. Such a loss typically arises when the government overpays for a product or service, pays for a product or service it did not receive, or pays for a product or service that is defective or otherwise different from what the government contracted to purchase.
“Dodd-Frank” refers to the Dodd-Frank Wall Street Reform and Consumer Protection Act, which became law in 2010, following the 2008 financial crisis. Dodd-Frank includes many provisions meant to prevent fraud and abuse in the securities and commodities markets, and Dodd-Frank created both the SEC Whistleblower Program and CFTC Whistleblower Program. “Dodd-Frank whistleblowers” is often used as a general term to refer to those with claims under either the SEC or CFTC whistleblower programs.
Whistleblowers do not need to be citizens of the United States. In many cases, whistleblowers located outside of the United States are best positioned to uncover schemes involving fraudulent bills submitted to the U.S. government, U.S. tax evasion, or securities fraud involving U.S. companies. Foreign nationals who have information about fraudulent activity that is covered by whistleblower programs in the United States can bring claims under those laws.
Furthermore, the companies on whom the whistle is blown do not need to be based in the United States.
For more information on the international aspect of whistleblower rewards programs, we recommend our International page, and articles about international whistleblowers.
Even among lawyers and judges, you will hear different pronunciations of qui tam. Some say kwee tam, some say kee tam, some say kwee tom or kee tom.
The phrase is drawn from the longer Latin phrase, “qui tam pro domino rege quam pro se ipso in hac parte sequitur,” which means “he who sues on our Lord the King’s behalf as well as his own.” With no settled agreement on how to pronounce the first two words, we are glad we don’t have to worry about how to pronounce the rest of them.
AG – Attorney General. The Attorney General of the United States is the head of the U.S. Department of Justice. States also have Attorneys General as their chief legal officers.
AKA and AKS – These abbreviations can refer to one of two separate laws: First, the federal Anti-Kickback Statute, 42 U.S.C. § 1320a-7(a) (“AKS”), which applies to federal healthcare program business; and, second, the federal Anti-Kickback Act of 1986, 41 U.S.C. § 51 et seq. (“AKA”), which applies to government contracts.
AUSA – Assistant United States Attorney. An attorney representing the United States working in the Department of Justice. AUSAs can work at and for one of the 94 U.S. Attorney’s Offices around the country, or at “Main Justice” in Washington, D.C.
CFPB – Consumer Financial Protection Bureau
CFTC – Commodity Futures Trading Commission
CMS – The Centers for Medicare and Medicaid Services, part of the U.S. Department of Health and Human Services, overseeing Medicare, Medicaid, and other government healthcare programs.
DOD – United States Department of Defense
DOJ – United States Department of Justice
DOT – United States Department of Transportation
EU – European Union
FCA – False Claims Act. Depending on the context, can refer to the Federal False Claims Act, or a state False Claims Act.
FCPA –Foreign Corrupt Practices Act
FHA – Federal Housing Administration
FIRREA – Financial Institutions Reform, Recovery, and Enforcement Act of 1989
FTC – Federal Trade Commission
GSA – United States General Services Administration. Constructs and manages federal buildings, and offers procurement services to government organizations.
HHS – United States Department of Health and Human Services
IRS – The Internal Revenue Service, a bureau of the United States Department of the Treasury.
SEC – United States Securities and Exchange Commission
A number of government agencies regularly bring direct enforcement actions related to fraudulent schemes, including those involving various fraud against federal and state governments, investors, tax, and financial activity. You can see recent and past enforcement actions by clicking on the following agencies: DOJ (United States Department of Justice), state (state departments of justice), SEC (Securities and Exchange Commission), IRS (Internal Revenue Service), CFTC (Commodities Futures Trading Commission), and others including FinCEN, the CFPB, FTC, and EPA.
Almost anyone with evidence of fraud or misconduct can be a whistleblower. You do not have to be a current or former employee of the company that engaged in the fraud or misconduct. You do not need to have witnessed the fraud or misconduct yourself or have documentary evidence of the fraud or misconduct. You do not need to be an American citizen or resident. And you may even have been involved to some extent in the misconduct.
For more information, we recommend our articles about whistleblower eligibility.
Generally, the sooner you bring your claim the better. A number of different statutes of limitation may apply. If someone else reports the same fraud, it might raise “first-to-file” concerns, or “public disclosure” concerns. It is not usually a problem if the whistleblower has attempted to report and correct the problem before submitting a claim. Timeliness can be a tricky legal issue for which you should consult with a whistleblower lawyer as soon as you realize you may have a claim.
For more information and specific examples, we recommend our page I Think I Have a Whistleblower Case and our post about Time Limits under the False Claims Act.
Each individual will want to weigh a number of factors when determining whether to be a whistleblower, including whether the individual qualifies and has the right evidence, the impact of personal concerns such as anonymity, retaliation, or personal involvement in the conduct.
To learn more about whether to be a whistleblower and consider all your options, we recommend these resources:
The risk of retaliation against whistleblowers is very real. Employees who have reported misconduct have been unfairly fired, transferred, demoted, or suffered other mistreatment, and even those who are not employees of the target company, or are no longer employees, may face some form of estrangement, alienation or even blacklisting. However, many federal and state whistleblower laws have anti-retaliation provisions to prevent and punish such retaliation. These provisions are intended to protect whistleblowers from being fired or demoted or in any way discriminated against in the terms or conditions of their employment in retaliation for bringing a whistleblower claim.
Typically, submissions under the whistleblower reward programs are confidential and the identity of the person providing the information is not public. Whether a whistleblower can remain anonymous depends in large part on the particular whistleblowing program involved and on how the case proceeds. While some programs provide for anonymous filing, and others provide for a period of confidentiality, if the government is forced to litigate or go to trial regarding the underlying violation, the whistleblower’s information and identity may need to be revealed. In addition, there are the practical realities of whistleblowing, and the company might guess the whistleblower’s identity correctly based on what the government in investigating. If you believe you may have a case and are concerned about your identity becoming known, you should talk with an experienced whistleblower attorney about the likelihood of disclosure, and options to protect your identity.
Participating in the fraud does not automatically mean a whistleblower cannot file a claim or receive a reward. This is especially true if a whistleblower participated in the fraud unknowingly or at the direction of a superior. In fact, such individuals often have access to exactly the sort of information necessary, and the law recognizes that to prevent ongoing fraud we need such people to come forward. Although a whistleblower may receive a reduced reward if his or her participation in the fraud was substantial, generally a whistleblower will be barred from receiving a reward only when the whistleblower planned or initiated the fraud, or is ultimately convicted of a crime stemming from the reported fraud.
Whistleblowers often find it gratifying to share their story and evidence with counsel, the government, and ultimately the public. There can be tremendous satisfaction in finally being heard and having the evidence reviewed and investigated. Becoming a whistleblower, however, is not for everyone. The process can be lengthy, lonely, and frustrating. First, becoming a whistleblower does not guarantee a large recovery. While some whistleblowers obtain bounties of millions of dollars, these recoveries are the exception, not the rule. Second, becoming a whistleblower can be a tiresome and unpleasant ordeal. Although there are laws protecting whistleblowers, the risk of retaliation or some form of estrangement or alienation remains very real. Third, the process takes a very long time, in most cases several years or more. During this process, whistleblowers can feel out of the loop and helpless as the government proceeds with its investigation. The government often keeps a tight lid on the progress of its investigations and may not communicate for long stretches of time. On top of that, generally a whistleblowers may not discuss their matters with people other than their attorneys or the government; keeping this silence can be very challenging.
To learn more about whether to be a whistleblower and consider all your options, we recommend these resources:
Submitting a case entails ensuring that you have the right kind of evidence, selecting an experienced attorney that is the right fit for you, and presenting your claim and evidence in the appropriate forum in an effective manner. After your matter is submitted, you and your attorney will likely meet with government attorneys and your case may undergo a long period of investigation.
The particular steps depend on the type of claim you have, because different whistleblower reward programs have different requirements and rules. For more information and specific examples, we recommend our page I Think I Have a Whistleblower Case.
Persons with information about fraud often attempt to report and fix the behavior internally with the employer or company. Such efforts are often futile or unsatisfactory, or worse, result in retaliation. Such whistleblowers may find it useful to consult with an experienced employment attorney regarding such efforts. Some whistleblowers also attempt to report directly to the government, with mixed results. By making a submission through an appropriate whistleblower reward program with experienced counsel, you increase your chances of being heard.
The whistleblower reward programs can be complicated to navigate. An experienced attorney in these areas helps you determine whether bringing a case is right for you, develop the case, and avoid pitfalls. Look for a responsive attorney or firm with a history of successful partnerships with the government under the various whistleblower programs. Even if you have reported your information in some manner already, you’ll want to start your search for the attorney or firm best-suited for you as early as possible. Many whistleblower attorneys represent clients on a contingency basis.
To learn more about hiring a lawyer, we recommend these resources:
The longest phase of the whistleblower process is typically the time it takes for the government to investigate the reported fraud or misconduct. During this period, the government will likely want to interview the whistleblower at least once. The government will also likely interview other witnesses involved in or with knowledge of the fraud or misconduct. It will also try to secure internal company documents relating to the challenged conduct and the records of the government agencies that may have been the subject of the fraud or misconduct. Under the False Claims Act, the government has sixty days under which the whistleblower’s complaint will remain under seal so that it can conduct its investigation without anyone knowing about it. At the end of this period, the government will routinely ask for multiple extensions of the seal to continue its investigation, interview additional witnesses, review documents, issue search warrants, conduct raids and coordinate with multiple government agencies. This period of investigation easily can last a year or longer. At the end of this period, the government will decide whether it wants to bring a formal legal action against the company accused of the fraud or misconduct.
Often, whistleblowers are frustrated after years of attempting to right a wrong or hold a person or company responsible for cheating others. For many whistleblowers, finally taking action through a submission or lawsuit is empowering and satisfying in and of itself, whether or not the case ultimately succeeds.
Under the False Claims Act, and the SEC, CFTC, IRS, and Motor Vehicle Safety whistleblower programs, as well as under several other laws, a whistleblower responsible for providing the government with evidence that leads to a successful prosecution or settlement may be entitled to a percentage of the government’s recovery. The size of the award, and the specific requirements to be eligible for an award, vary between programs. You should consult with a whistleblower lawyer to determine if you have information that could lead to a claim under one of the whistleblower reward programs.
To learn more about the whistleblower experience, we recommend these resources:
Investigations often take a very long time, in most cases several years or more. It may be difficult to not be able to discuss your sealed case for a long period of time. A lawyer who can guide you through this and other tricky situations that arise during the government’s investigation is invaluable.
The False Claims Act is the statute most commonly employed by whistleblowers to report fraud against the federal government; many states have similar laws to report fraud against state and local governments. The False Claims Act allows private citizens, known as “relators,” to bring a lawsuit on the government’s behalf and may reward them with a significant portion of any government recovery (anywhere from 15-30%).
The key factor in determining whether conduct is covered by the False Claims Act is whether that conduct caused the government to suffer a financial loss. As examples, such losses are incurred when the government overpays for a product or service, pays for a product or service it did not receive, or pays for a product or service that is defective or otherwise materially different from what the government contracted to purchase. The government also suffers a relevant financial loss when a company falsifies information or improperly structures its activities so as to avoid making required payments to the government or keep overpayments it has received.
Under the SEC and CFTC whistleblower programs, whistleblowers who disclose fraud and misconduct involving publicly traded companies or in the sale and trading of securities and commodities, or otherwise regarding violations of the securities laws or Commodity Exchange Act may receive up to 30% of recoveries achieved because of their information. Common types of misconduct addressed by these laws include: Ponzi schemes, insider trading, accounting fraud, foreign bribery, and market manipulation.
Unlike the False Claims Act, the Dodd-Frank Act covers fraud or misconduct that harms private investors, even if it was not directed at the government or caused a financial loss to the government.
The IRS whistleblower program provides mandatory rewards of 15-30% of any IRS recovery to whistleblowers who provide the IRS with information relating to tax non-compliance or avoidance exceeding $2 million.
Banks and financial institutions may be participants in financial and investment fraud that can give rise to a whistleblower under a number of different programs. Financial institutions may be involved in housing and mortgage fraud cases, which have been some of the largest False Claims Act and other cases. Additionally, the Financial Institutions Reform, Recovery, and Enforcement Act, or FIRREA, permits the Department of Justice to sue federally insured financial institutions for wrongful acts including wire and mail fraud, embezzlement, illegal gifts, bookkeeping violations, and false statements in loan applications. Whistleblowers can bring claims under FIRREA pursuant to the Financial Institutions Anti-Fraud Enforcement Act, or FIAFEA.
Fraud in the healthcare, pharmaceutical, and durable medical equipment industries is a pervasive and significant form of fraud perpetuated against federal and state governments. There are numerous schemes defrauding government healthcare programs that can give rise to whistleblower reward claims under the False Claims Act.
Broadly speaking, the Anti-Kickback and Stark laws collectively prohibit medical providers from paying or receiving kickbacks, remuneration, or anything of value in exchange for referrals of patients who will receive treatment paid for by government healthcare programs such as Medicare and Medicaid. Claims for payment submitted to government health care programs that are tainted by kickbacks or Stark violations are also violations of the False Claims Act and may provide the basis for a whistleblower action.
Whistleblowers often bring successful cases based on fraud in government contracting, sometimes known as “procurement fraud.” Federal and state governments purchase goods and services ranging from weapons systems to computer consulting to uniforms, under a variety of procurement and government contracting rules and systems. Fraud is committed by those who sell goods and provide services to the government in many different industries and through many different schemes and structures.
The Motor Vehicle Safety Whistleblower Act gives industry insiders a financial incentive to report motor vehicle safety-related problems. Under the program, a whistleblower can receive a reward of up to 30% of any monetary sanctions over $1 million the government imposes based on information the whistleblower provides. Unlike the other rewards programs, eligible whistleblowers must be an employee or contractor of a motor-vehicle manufacturer, parts supplier, or dealership.
The government aggressively targets housing and mortgage fraud and misconduct that has far reaching implications, such as originating and underwriting residential mortgage loans that should have never been made because of the weak underlying financial condition of the borrower, and defrauding investors in structured financial products.
Yes, it can. Whistleblowers can be eligible for financial rewards in a number of ways, including for example when they report misrepresentations about the amount of oil, gas or other resources extracted from public lands in order to fraudulently underpay royalties to the government, or false representations made to avoid paying environmental fines. There are also whistleblower awards for reporting ocean dumping (ship pollution) and for certain violations of laws protecting wildlife. For more information and specific examples, we recommend our Environmental page, and our articles about environmental fraud.
Insurance companies and government insurance programs are often targets of fraudulent activity. Whistleblowers with knowledge of fraud can be eligible for awards when reporting fraud in federal crop or flood insurance programs, or even when reporting fraud on private insurers in certain States. Fraud on federal healthcare insurance programs (such as managed care fraud in Medicare and Medicaid programs) also may form the basis of a case.
The Foreign Corrupt Practices Act (FCPA) is intended to stop the widespread bribery of foreign officials by U.S. companies and to create a level playing field for honest businesses. Violations of the FCPA can form the basis of an SEC whistleblower submission.
In our confidential case evaluation process, Constantine Cannon lawyers will discuss your potential claims with you and review the evidence you have as we determine is appropriate. There is no charge for this case evaluation, and no obligation on your part; we encourage you to speak with other lawyers. By evaluating your case, we are not agreeing to serve as your lawyers, nor are you agreeing to hire us. If we agree to represent you and you agree to hire us, we will enter in to a formal written retainer agreement.
By law, the evaluation is privileged, even though we may never enter in to an attorney-client relationship, and we will not share your information or otherwise use it for any purpose without your permission.
Lawyers must avoid conflicts of interest between clients and representations. Before we can evaluate your claim, we must know who the claim is against, and may need to know some about the nature of the claim, so that we make a determination regarding conflicts of interest.
We understand the unique concerns our clients have about confidentiality, and we will ensure that your communications with us and your identity are secure. If you have particular concerns about how best to provide us with the evidence you have, you may call us to discuss appropriate procedures.
Please call us to discuss any concerns about particular evidence you may have. It is not uncommon for whistleblowers to have sensitive information, and a number of laws, including HIPAA, provide exemptions for whistleblowers to disclose that information subject to specified protections. Our attorneys have experience dealing with such protected information.
Yes. We work with clients around the country and around the world. For whistleblower claims initiated with the filing of a lawsuit under the federal or a state False Claims Act, we will determine the most appropriate venue to file the case. We have litigated and worked with government enforcers throughout the United States, and bring first-hand knowledge of courts, judges, and federal and state agencies that is invaluable when pursuing a whistleblower case. For whistleblower claims under the SEC, CFTC, IRS, and Motor Vehicle Safety programs, no lawsuit is filed. With offices on both coasts and in London, we have an unmatched geographic presence to provide a home base for cases arising anywhere in the United States, Europe, or elsewhere.
We represent whistleblower clients on a contingency fee basis. This means that you do not make any payments to us unless your case is successful and you receive a whistleblower award. We are paid a percentage of any whistleblower reward our clients receive, by settlement or otherwise, and if the case involves the False Claims Act, can also recover our hourly fees and expenses from the defendant. If you do not recover anything, we receive nothing. If you retain us, a formal written retainer agreement will spell out the payment terms in detail.