The False Claims Act allows whistleblowers (referred to as “relators” under the statute) to report fraud and bring a lawsuit—known as a qui tam action—on behalf of the government. The whistleblower receives between 15 and 30 percent of any recovery, depending in part on whether the government intervenes and prosecutes the case. If you are aware of fraud on the government, you should speak with competent, experienced attorneys to help you determine whether you should report the fraud and bring a whistleblower action.

Congress passed the False Claims Act in 1863 at President Lincoln’s request. The purpose of the law was to help the government combat rampant fraud hobbling the Union’s war efforts during the Civil War. The law was successful, and it has remained ever since.

In 1986, Congress enacted a series of amendments to the False Claims Act to increase private enforcement by private citizens. These amendments were passed by overwhelming bipartisan Congressional support led by Senator Charles Grassley (R-IA) and Representative Howard Berman (D-CA). The purpose of the amendments was, in part, to stem massive fraud reported in connection with initiatives to strengthen the military and win the Cold War. Accordingly, the False Claims Act primarily was used to stop fraud by defense contractors until the late 1990s, when enforcement efforts increasingly focused on health care fraud. By 2017, over 70% of all False Claims Act recoveries were in the health care industry.

Between 2009 and 2010, a series of additional amendments were made to the False Claims Act to further encourage private enforcement by whistleblowers in the backdrop of Frank—Dodd financial reform and efforts to provide affordable, universal healthcare. Among other things, Congress amended the statute to permit private individuals to bring qui tam actions based on information that was disclosed in prior lawsuits, so long as the government was not a party. See §3730(e)(4)(A)(i). Additionally, Congress authorized whistleblowers who were not traditionally “insiders” to bring suit by removing the requirement that relators have “direct” knowledge of the underlying fraud. See §3730(e)(4)(B).

Today, private whistleblowers play a critical role in enforcing the False Claims Act: 70 to 80 percent of cases are initiated by them. In 2017, whistleblowers recovered $426 million pursuing qui tam suits—roughly 11.5% of the $3.7 billion in total False Claims Act recoveries for that year. In other years, the proportion is much higher. For example, in 2015, roughly 27% of all False Claims Act recoveries were obtained by private relators pursuing qui tam actions.

If you know of fraud on the government and would like to join the fight to prevent waste of taxpayer funds, we can help.

We can provide you with a free consultation to give you the information you need to protect your rights and decide what you should do.