Fraud under federal contracts, grants, and programs has extraordinary costs for taxpayers. Fraud can also present significant risks for public health and safety, particularly in the healthcare, transportation, construction, and defense sectors. While federal agencies do their best to uncover fraud—and while we routinely see government investigations targeting all forms of fraud, waste, and abuse—federal agencies also rely heavily on private citizens to come forward.

In many cases, coming forward involves serving as a whistleblower, or qui tam relator, under the False Claims Act (FCA). Under the FCA, qui tam relators can report any type of false or fraudulent claim under a federal contract, grant, or program. While qui tam relators can file whistleblower claims on their own, they can also hire whistleblower lawyers to represent them.

“For individuals who have information about fraud, waste, and abuse involving taxpayer-funded operations in the private sector, filing a whistleblower case under the False Claims Act can be extremely important. The first step is to speak with an attorney at a whistleblower law firm who can explain the process and the requirements for securing protected whistleblower status.” – Dr. Nick Oberheiden, Founding Attorney of Oberheiden P.C.

What do prospective whistleblowers need to know about filing a qui tam complaint? Here are the answers to some frequently asked questions about working with a False Claims Act attorney to expose fraud, waste, or abuse:

What is the False Claims Act (FCA)?

The False Claims Act (FCA) is a federal statute that prohibits companies from submitting any “false or fraudulent claim for payment or approval” under any federal contract, grant, or program. There are also state false claims acts, and federal and state governments alike rely on whistleblowers to help them determine when enforcement action is warranted. Generally speaking, however, references to “the False Claims Act” refer to the legislation that exists at the federal level.

What Constitutes a “False Claim” Under the False Claims Act?

A “false claim” can take many different forms. The U.S. Department of Justice (DOJ) pursues whistleblower cases in federal court involving false claims including (but by no means limited to):

• Government contracting fraud and procurement fraud (including bid collusion, double-billing, product substitution, and other forms of fraud under defense, transportation, construction, and other infrastructure contracts)
• Government program fraud (including fraud under long-standing programs like Supplemental Nutrition Assistance Program (SNAP), disaster relief programs, and other relief programs like the pandemic-era Paycheck Protection Program (PPP)
• Healthcare fraud (including Anti-Kickback Statute violations and billing fraud under programs administered by the U.S. Department of Health and Human Services such as Medicare fraud and Medicaid fraud)
• Mortgage fraud and bank fraud involving federally insured institutions (even though these institutions are not government agencies, the False Claims Act still applies since they are federally insured)
• Public corruption and foreign bribery (including bribery of U.S. and foreign government officials in connection with efforts to secure government contracts, government concessions, or other government benefits domestically or abroad)

U.S. Attorney’s Offices rely on domestic and international whistleblowers to file qui tam cases disclosing these (and other) forms of fraud against the government. While filing a qui tam case is a formal legal process, whistleblower clients who hire an attorney to represent them can rely on their attorney to navigate the process on their behalf. Notably, while securities fraud generally is not covered under the FCA, other federal laws provide protections and opportunities for compensation to securities fraud whistleblowers.

What Protections Are Available to Whistleblowers Who File FCA Claims?

Whistleblowers who assist the federal government with combatting fraud are entitled to protection against retaliation under the False Claims Act—provided that they come forward through the appropriate means. This means that a company cannot fire an employee because of his or her decision to initiate a qui tam action. Even if a qui tam relator’s case does not lead to government intervention and a successful enforcement action, the False Claims Act’s protections still apply.

What Compensation is Available to Whistleblowers Who File Successful FCA Cases?

The False Claims Act entitles relators to financial awards when their qui tam suits lead to successful whistleblower cases. False Claims Awards are percentage-based, and the percentage of the civil penalties that whistleblowers are entitled to receive depends on factors including (but not limited to):

• The volume and importance of the information the whistleblower provides;
• The amount of assistance the whistleblower provides during the investigation; and,
• Whether the government intervenes or declines to intervene (in which case a whistleblower must pursue his or her case in federal court independently).

If the government intervenes in a whistleblower case under the False Claims Act, the whistleblower is entitled to a reward of 15 to 25 percent of the amount the government recovers—whether via summary judgment, trial verdict, or settlement. If the government declines to intervene, the whistleblower will generally be entitled to an award of 25 to 30 percent of the amount recovered.

Do I Need to Hire a False Claims Act Lawyer to Report Fraud, Waste, or Abuse to the Federal Government?

While not legally required, hiring a False Claims Act lawyer to report fraud, waste, or abuse to the federal government is strongly recommended. There are several reasons why.

First, the process of filing a qui tam complaint is complicated, and mistakes made when filing a complaint can result in ineligibility for whistleblower protections and compensation. An experienced whistleblower lawyer will be able to assist with preserving his or her clients’ eligibility.

Second, while there are costs involved in filing a qui tam complaint in federal court, most whistleblower lawyers will cover their clients’ court costs for them. As discussed in greater detail below, whistleblower lawyers generally represent their clients on a contingency-fee basis, which means they only recover their costs and earn a fee when their clients receive whistleblower awards.

Third, by working closely with an experienced False Claims Act attorney throughout the process, whistleblowers can ensure that they make informed decisions, and they can get the answers they need when they need them. Whistleblower attorneys know these claims are complicated, and they know that clients who have such claims need to be able to rely on sound legal advice going forward.

How Much Do False Claims Act Attorneys Typically Charge?

False Claims Act attorneys typically represent their clients on a contingency-fee basis. This means that their legal fees and costs will be deducted from a whistleblower’s award if the whistleblower’s qui tam suit is successful. If a whistleblower’s qui tam suit is unsuccessful for any reason, the whistleblower will owe nothing for his or her legal representation.

Given that this is the case, prospective whistleblowers can hire a lawyer with an extensive track record handling qui tam lawsuits to represent them with no financial risk. Many seasoned whistleblower lawyers have well over two decades of experience working with the federal government on behalf of their clients. For those who are interested in speaking with a lawyer, the first step is to schedule a free consultation.

Why Do So Few Firms Handle FCA Litigation?

There are two main reasons why so few law firms handle False Claims Act (FCA) litigation. The first reason is that FCA cases are simply far less common than many other types of litigation. The second reason is that FCA cases are complex and time-consuming, and many law firms simply do not have the resources required to handle these cases effectively.

What If My Employer’s Defense Counsel Identifies Me as a Whistleblower?

It is unlikely that your employer (or its defense counsel) will be able to identify you as a whistleblower if you come forward in compliance with the qui tam provisions of the False Claims Act—as whistleblowers are entitled to strong confidentiality protections. With that said, even if your employer identifies you as a whistleblower, it will be prohibited from taking any adverse action against you under federal law. The False Claims Act prohibits retaliation against retaliation, meaning defendants in qui tam cases cannot legally make employment-related decisions based on an employee’s decision to blow the whistle.

What If My Employer Retaliates Against Me In Violation of the False Claims Act?

When a company illegally retaliates against a False Claims Act whistleblower, the whistleblower can sue his or her employer for damages. Many whistleblower attorneys represent their clients in retaliation cases as well—though, again, retaliation is unlikely in most cases.

Where Do I File a False Claims Act Case?

Whistleblowers must file their False Claims Act cases in federal court. Once a whistleblower files a qui tam complaint, the U.S. Department of Justice (DOJ) will evaluate the complaint, conduct a preliminary investigation, and then make a decision regarding intervention. Individuals who hire a whistleblower attorney to represent them can rely on their attorney to communicate with the DOJ on their behalf throughout this process.

What is the First Step for Filing a Qui Tam Lawsuit Under the False Claims Act?

While individuals can file False Claims Act cases on their own, hiring an experienced whistleblower attorney is strongly recommended for the reasons discussed above. For individuals who choose to hire an attorney to help them expose fraud and protect their legal rights, scheduling a free consultation is the first step in the process.