INTEGRITY IS REWARDED

Under U.S. Law, whistleblowers can be rewarded…generously.

 

America has a proud history of paying honest people.

 
 

Championed by Abraham Lincoln

In the United States, “qui tam laws” became a feature of the legal system when Abraham Lincoln wanted to eliminate fraud and faulty supplies being sold to the Union military during the Civil War. The False Claims Act was passed in 1863 and contained provisions that created a private right of action for citizens to sue fraudulent defendants on behalf of the government. These laws were created for situations where the government wants to encourage broader enforcement of a law beyond the capacity of law enforcement groups and are still used to this day to expose fraud, cheating, lying, polluting, and stealing from the public.

Expanded and strengthened

The False Claims Act has been expanded and strengthened over the years, allowing for a wider variety of fraud claims to be included such as Covid relief fraud, healthcare fraud, Medicare fraud, bribery of officials, commodities trading and securities violations, environmental pollution and tax evasion, as well as protections for whistleblowers against retaliation. Depending on the specific law, whistleblowers can receive compensation of 10% - 30% of the amount recovered by the government or penalty levied.

Paying rewards to the people that help identify and document violations is a rational economic model and benefits our society at large.

 

Do what’s right. And get rewarded for it.

 
 

Under both federal and state “Qui Tam” laws, the government typically pays 10-30% of any recovery or penalty from a report, provided certain conditions are met.  While the conditions will vary a bit depending on the specific law involved, in general, for a whistleblower to receive a reward, they must provide:

  • Original, credible, timely information

  • Results in a recovery or sanctions in excess of $1 million

  • “First in time, first in right” philosophy applies, meaning the first whistleblower filing a report usually wins, so it’s important to file quickly, once your information has been assembled and vetted by an attorney.

 

The US government has paid out over $1B to whistleblowers in the most recent fiscal year reported, including:

$564 million to whistleblower by the SEC, with the average whistleblower reward exceeding $5 million.

$309 million to whistleblowers under the False Claims Act

$200 million to a single whistleblower by the Commodity Futures Trading Commission (“CFTC”)

$86 million to whistleblowers from the IRS

 

Other sizable whistleblower awards:

$250 million paid to whistleblowers for illegal marketing practices by GlaxoSmithKline related to Paxil, Wellbutrin and Avandia in 2012.

$170 million for exposing Bank of America’s fraudulent practice of labeling high-risk mortgages as safe and selling them to government-issued mortgage companies in 2014

 $167 million paid to whistleblowers for the settlement of off-label fraud and kick-back allegations against Johnson & Johnson related to the prescription drugs Risperdal, Natrecor and Invega in 2012. 

$114 million award by the SEC and other agencies for related actions in 2020.

$110 million award by the SEC to a single whistleblower in 2021.