March 9, 2017 | Thornton Law Firm What is a whistleblower lawsuit? A whistleblower lawsuit is filed under the federal False Claims Act or a similar state statute. False claims acts allow people who know fraud is being perpetrated against the government to file lawsuits to stop the fraud. People who file claims are commonly referred to as whistleblowers or relators. Whistleblowers are entitled to compensation for stopping fraud against the government. Only the first whistleblower who files a claim for a particular fraudulent act or scheme is entitled to compensation, so it is important to act quickly if you know the government is being defrauded. Call 1-888-491-9726 or contact us online to discuss suspected fraud against the government. Common types of fraud against the government The federal False Claims Act, codified at 31 U.S.C. Sections 3729-3733, prohibits the following: Knowingly presenting or causing to be presented a false claim for payment or approval Knowingly making, using or causing to be made or used a false record or statement used in a fraudulent claim Conspiring to violate the False Claims Act Falsely certifying the type or amount of property used by the government Certifying government receipt of property on a document without being certain the information is correct Knowingly buying property for government use from an unauthorized vendor Knowingly making, using or causing to be made or used a false record to avoid or decrease an obligation to pay or transmit property to the government Knowingly presenting a false claim for payment and knowingly making false statements to support a claim are the two most common violations of the False Claims Act. IRS fraud is another common form of fraud against the U.S. government, and special rules apply encouraging IRS whistleblowers to come forward and file a claim. People with information about large tax underpayments, including accounting errors, tax fraud or evasion can receive up to 30 percent of the money recovered by the government based on the whistleblower’s information. SEC whistleblowing is another area where special rules apply. The U.S. Securities and Exchange Commission program also compensates informants with up to 30 percent of the amount recovered, but the recovery ordered must exceed $1 million for the whistleblower to receive compensation. The informant must have provided the information voluntarily, and individuals are excluded from participation in the program if they were convicted of violating related U.S. laws. The purpose of the restrictions is to avoid awarding those who participate in fraud from later profiting from their actions. Call 1-888-491-9726 or contact us online to discuss suspected fraud against the government. Federal False Claims Act The legal term for a person who reports fraud against the government is “relator.” The Federal False Claims Act shields relators from retaliation and provides a formula for compensating them. The provisions are as follows: Protection for the whistleblower from discharge, demotion, suspension, threats or other harassment or discrimination against the whistleblower by the employer if the whistleblower still works for the employer under 31 U.S.C. § 3730(h) Confidentiality for the whistleblower to file a fraud complaint under seal, which means that the defendant employers are not notified of a complaint until after the government investigates the claim under 31 U.S.C. §3730(b)(2) Compensation for the whistleblower to share from 15 to 25 percent of the government’s successful recovery under 31 U.S.C. § 3730(d) State false claim acts Besides the obvious incentive to root out fraud in state governments, the federal government provides an additional monetary incentive for states to pass false claims acts similar to the federal statutes. Under section 1909 of the Social Security Act, states with qualifying similar laws receive a 10 percent increase in their share of amounts recovered from whistleblower lawsuits. Twenty-nine states and the District of Columbia have enacted false claims acts: California Iowa New Mexico Colorado Louisiana New York Connecticut Maryland North Carolina Delaware Massachusetts Oklahoma District of Columbia Michigan Rhode Island Florida Minnesota Tennessee Georgia Montana Texas Hawaii Nevada Virginia Illinois New Hampshire Washington Indiana New Jersey Wisconsin Contact Massachusetts false claims act lawyers today Thornton Law Firm LLP is dedicated to providing personalized service to clients across the nation. We offer free consultations and work on a contingency-fee basis, meaning that if we don’t win your case, you don’t pay legal fees. Call 1-888-491-9726 or contact us online to discuss suspected fraud against the government. Remember that the first person to file a whistleblower lawsuit is the person entitled to compensation if the government recovers money based on the information.