If you have witnessed fraud abasing the government, or have credible information that fraud has taken place, you may want to become a whistleblower.  There are several ways an individual can become a whistleblower.  The most well known way is to file a a False Claim Act (qui tam) suit alleging that a company or individual has filed a false claim (i.e defrauded) the federal government.  Most states have copy cat false claims act statutes allowing a whistleblower to file a suit on behalf of the state to seek damages from the false claim.  The person filing the suit is called the Relator and alleges that  the government (not him or herself personally) suffered damages.  The government may intervene in the suit; that is they will take over and prosecute the lawsuit and seek to recover damages.  It is beneficial to have the government intervene because the government has resources to investigate the claim that a private plaintiff does not.  But even if the government does not intervene, (sometimes simply because they don’t have any attorneys free to work on the matter), the litigation can go forward.

If the government intervenes in the qui tam action, the relator is entitled to receive between 15 and 25 percent of the amount recovered by the government through the qui tam action. If the government declines to intervene in the action, the relator’s share is increased to 25 to 30 percent. Under certain circumstances, the relator’s share may be reduced to no more than ten percent. If the relator planned and initiated the fraud, the court may reduce the award without limitation. The relator’s share is paid to the relator by the government out of the payment received by the government from the defendant. If a qui tam action is successful, the relator also is entitled to legal fees and other expenses of the action by the defendant.

In some circumstances, a person can become a whistleblower and recover an award simply by providing useful information of wrongdoing to the appropriate government agency.  The Securities and Exchange Commission, the Commodities Futures Trading Commission and the IRS are some of the agencies that have this type of legislation.  For example, in July 2018 an unidentified person who told regulators at the U.S. Commodity Futures Trading Commission about illegal activity at a financial institution will receive approximately $30 million.  The CFTC awarded the payout because the informant provided “specific, timely and credible” information that prompted CFTC staff to launch an investigation.

The above summary is very general and cannot be relied upon as legal advice for your specific circumstances. Becoming a whistleblower is a very serious decision that should be made after full consultation with an experienced attorney who has your interests in mind.  If you would like to discuss your situation confidentially, please feel free to contact me at bob@reconnollylaw.com or call at (215) 219-4418.