The federal government loses billions of dollars to fraud every year. Mortgage companies falsify documents in order to earn commissions on loans. When the borrower can’t pay, the FHA or Fannie Mae steps in – your tax dollars. Ditto for doctors that bill Medicare for unnecessary services or services not even performed. Same for vendors that sell substandard quality products to the government. Who knows best how to identify the waste? Whistleblowers!
According to Representative Darrell Issa, the government lost $261,000,000,000 last year (or 7% of the federal budget). Congressman Issa ought to know, he is chair of the House Oversight and Government Reform Committee. If you add the losses at the local and state level, the total number becomes staggering.
With federal agencies cutting budgets, its important for those agencies to put every penny of their budget to good use. That’s where whistleblowers play an important role.
Whistleblowers have been on the front lines of fraud prevention for centuries. During the Civil War, President Abraham Lincoln asked Congress to pass the federal False Claims Act. That law remains on the books today. Under the law, whistleblowers can receive a reward of up to 30% of whatever is collected on behalf of the government.
Lincoln was worried about the sheer number of people and businesses that were ripping off the Union Army during the war. With resources stretched thin, the federal government didn’t have the time or resources to sue every vendor that sold rancid rations, lame mules or faulty guns to the government. Under the false claims act – sometimes called the Lincoln law after President Lincoln – ordinary people were authorized to act as mini Attorney Generals and sue on behalf of the government.
The law still works the same way 2 centuries later. To receive an award, a whistleblower must have original, non public information about a fraud on government agency or federally funded program. The key words are “original” and “non public” information. If you read about the information in a newspaper, you are not considered an “original source.” If two or more people file with the same information, generally the first in line gets the reward.
To claim a reward, you must file a complaint against the person or company causing the fraud. The complaint is filed in court and under seal meaning it is secret. While under seal, the government is given an opportunity to investigate the allegations. Ultimately, if any money is collected, the court can award up to 30% of what is collected to the whistleblower.
Just like the federal government, most states have their own similar laws. Unfortunately, some state laws only apply to healthcare fraud. Others, however, like New York allow whistleblowers to collect on unpaid and unassessed tax debts.
If you wish to become a whistleblower and have inside, non public information about fraud against the government or involving federally funded programs, give us a call. We represent whistleblowers and help them collect the largest award possible. More importantly, we help them put a stop to fraud.
Mahany & Ertl – America’s Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Minneapolis, Minnesota; Portland, Maine and San Francisco, California. Services available in many jurisdictions.
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Posted by Brian Mahany, Esq.