People love to tell lawyer jokes. Oftentimes, the criticisms inherent in the joke are justified. When it comes to the fight against government fraud, however, good lawyers not only are an indispensible part of the process: they also could make you rich. In the U.S. health care system alone “fraudsters, scammers and organized criminal gangs are bilking the system of as much as $100 billion a year”. http://money.cnn.com/2010/01/13/news/economy/health_care_fraud/. To combat such massive fraud, the United States, and most every state, has legislation that empowers the people to pursue individual claims on behalf of the state or federal government. These suits are called “whistleblower” or “qui tam” claims (a Latin phrase that means someone is suing “for the King as well as for himself”). In common law, a writ of qui tam is a writ whereby a private individual who assists the government prosecution can receive all or part of any penalty imposed.
The False Claims Act allows a private person, known as a “relator,” to bring a lawsuit on behalf of the United States, essentially as a private detective. You must have information that the named defendant has knowingly submitted or caused the submission of false or fraudulent claims to the United States. Whether you were personally harmed by the defendant’s conduct is irrelevant. However, the information you have acquired must not be public knowledge, unless you qualify as an “original source.” The government has the right to take over your suit if it has merit. If so, you stand to recoup huge sums of money.
If you have specific evidence a company is defrauding the government, you can become a whistleblower, and file a lawsuit on behalf of the government. If the claim is successful, you are entitled to a percentage of any money the government recovers. Under the False Claims Act, the U.S. Department of Justice, or your individual state has a limited time period to investigate the claim and elect whether it will join in the legal action. If the government joins the lawsuit, the whistleblower can receive between 15 and 25 percent of the recovery depending on the value of the information provided. The awards to whistleblowers are intended to reward people who expose corporate wrongdoing.
How much money can a relator earn?
The Department of Justice has described qui tam litigation as a “Billion Dollar Industry”. http://www.justice.gov/usao/eousa/foia_reading_room/usab4501.pdf. Just last year, a single whistleblower, was awarded $96 million dollars in “biggest whistleblower award ever”, for her efforts in exposing a London-based pharmaceutical company for “for faulty manufacturing processes at its plant in Cidra, Puerto Rico”. http://www.allvoices.com/contributed-news/7163375-us-woman-to-receive-96m-the-biggest-us-whistleblower-award-in-history. In September 2009, a former Pfizer Inc. sales representative, John Kopchinski, was awarded $51.5 million for his role as a whistleblower in the investigation of Pfizer’s marketing practices of Bextra. Pfizer pled guilty to various civil and criminal charges and paid in total $2.3 billion to the government. http://en.wikipedia.org/wiki/Qui_tam.
What to do if you witness government fraud
If you believe you have discovered fraud at your workplace, you should gather whatever documentary or electronic evidence is lawfully available (without violating the law or the terms of any employment agreement). If you have attended meetings where the fraud was discussed, or been involved in similar events, you should make a record of the details, including when they took place, what was said by whom, who was present, and what documents exist that memorialize the fraud. These notes should addressed to your qui tam attorney, so they can be protected by the attorney-client privilege. To your friends, you should remain tight-lipped.
Current and former employees are in a unique position to know exactly what is going on behind closed doors; usually in a better position than any government investigator. There are many law firms in the U.S. that focus exclusively on these types of claims. With the assistance of good lawyers, you can become a part of the fight against government fraud. Indeed, your efforts also may pay off handsomely.