July 2, 2019 In 2018, whistleblowers led the way to $2.1B in False Claims Act recoveries, continuing a long legacy of ordinary citizens fighting for what’s right since the United States’ first qui tam whistleblower law was passed in 1778.
What’s Behind Whistleblower Qui Tam Cases?
Today’s whistleblowers operate under the provisions of the False Claims Act (31 U.S.C. §§ 3729–3733, also called the “Lincoln Law”), one of the federal government’s primary tools used to combat fraud. The Act’s “qui tam” provisions allow a private citizen to sue on behalf of the government. These “relators” may even be awarded 15 to 30 percent of recovery.
What Counts as Fraud Under Whistleblower Laws?
The False Claims Act applies to fraud involving any federally funded contract or program, except in cases of tax fraud. That can include defense contractors, health care providers, pharmaceutical companies, mortgage lenders, and telecommunications companies. In fact, we’ve worked on all kinds of whistleblower qui tam cases. It is impossible to list all the types of cases prosecuted under the False Claims Act, but here’s a general idea:
- Billing for goods and services not delivered or rendered
- Obtaining any federal contract through kickbacks or bribes
- Shifting expenses from one fixed-price federal contract to another
- Providing inferior or defective products to the government
- Defective testing of products
- Double billing
- Upcoding healthcare charges using a different code for a more expensive treatment
- Billing for healthcare tests not performed
- Providing kickbacks for the referral of Medicare, Medicaid or other federally funded healthcare program beneficiaries.
- Billing for non-FDA approved drugs or devices
- Illegal marketing of prescription drugs and medical devices
History of the False Claims Act
One of the first whistleblower laws came into existence to protect soldiers in the Continental Army seeking protection when blowing the whistle on their superior’s illegal behavior. The current False Claims Act was passed into law during the Civil War. The contractors used by the Union Army often cut corners when providing necessities like uniforms, shoes, guns, gunpowder, and horses. “Soldiers complained about shoddy uniforms that would dissolve in the rain. They would get horses that were withered, that were weak and in some cases blind,” said Mark Greenbaum, an attorney who studies the Civil War era.
All of the government’s resources were being put towards the war effort. Without enough inspectors to ferret out the fraud, Congress created a law that provided an incentive for individuals to shine the light on fraud, giving whistleblowers a portion of any fine it collected based on their allegations.
It came to prominence again in the 1980s, when stories about military spending, including $400 hammers and $600 toilet seats, began to surface. Congress strengthened the law and defense industry whistleblowers began to come forward. Eventually, individuals in the pharmaceutical and health care industries brought more cases as well.
Importance of Whistleblowers Today
The False Claims Act is alive and well today. It’s critical to fighting fraud in defense, health care, medical devices and prescription drugs — and more!
The False Claims Act is all but useless without whistleblowers. The government needs the help of everyday men and women to assist in uncovering and prosecuting fraud.
Have you witnessed fraud committed against the government? Contact us now for a confidential case review.
Our attorneys represent whistleblowers who expose fraud and false claims against the government. Many of our lawyers practice qui tam whistleblower litigation and False Claims Act matters and have worked on cases including government contractor fraud and procurement fraud, health care fraud, and assisted living fraud. They also represent whistleblowers who report securities fraud to the SEC, including Foreign Corrupt Practices Act (FCPA) violations. Waters Kraus Paul & Siegel is a national plaintiffs’ firm based in Dallas with offices in Los Angeles, Baton Rouge, and by appointment in Moline. Contact us online or at 800.226.9880 to learn more about our practice and our qui tam attorneys.
