2014 a Record Year for Qui Tam Lawsuits, $435 Million to Whistleblowers

Arch for In the News.jpgIt was a record year in 2014 for whistleblower lawsuits. For the first time ever, the federal government recovered over $5 billion in fraud and waste claims in fiscal year 2014, which ended September 30, 2014. The total of $5.69 billion in settlements and judgments was a one-year record. Going back to 2009, the U.S. Department of Justice says it has recovered $22.75 billion in taxpayer dollars through such actions.

The federal government points to the False Claims Act – and revisions to the law that provide more incentives for whistleblowers to come forward – as reasons for these record recoveries.

The False Claims Act dates back to the Civil War and was passed to stop contractors from defrauding the government by selling it shoddy goods. In 1986, the law was amended to allow whistleblowers to sue for up to three times the government’s damages.

Whistleblowers Can Receive Up To 30 Percent of Financial Recovery

In whistleblower lawsuits, also known as Qui Tam actions, a citizen with “insider information” files a lawsuit on behalf of the federal government that alleges fraud by a company. Whistleblowers receive a percentage of any recovery, as much as 30 percent. If the government declines to join the suit, that percentage can be even larger.

Of the $5.69 billion recovered in 2014, $3 billion came from whistleblower lawsuits. According to the Department of Justice, over 700 Qui Tam actions were filed. And the whistleblowers’ share of recoveries was $435 million.

This year’s False Claims Act recoveries focused largely on these industries:

• Financial

• Healthcare

• Housing and mortgage

When the False Claims Act was amended in 1986, the law also offered increased protections to whistleblowers from employer retaliation. But whistleblower lawsuits still can be hard to navigate for individuals who only want to do the right thing.

Therefore, if you have knowledge of a company defrauding the federal government and want to take action, you may want to meet with an attorney who handles whistleblower lawsuits for further information.

The choice of a lawyer is an important decision that should not be based solely on advertising.