Why report fraud?

The federal government relies upon its citizenry to help prevent fraud upon the Treasury. To encourage citizens to "blow the whistle" on fraud, the United States Congress enacted The False Claims Act ("FCA"). The FCA is designed to reward any person who knows that an individual or company has financially defrauded the federal government, by allowing that whistleblower to file a "qui tam" lawsuit to recover damages on the government's behalf. Under the FCA, an individual who reports fraud is entitled to up to 30% of the total government recovery from a case. There are also protections in the law for whistleblowers who choose to come forward.

How much money can an individual be awarded under the IRS Whistleblower Reform Act?

The whistleblower typically receives between 15% and 25% of the total government recovery. However, the whistleblower recovery may be up to 30% if the government does not intervene in the case. Congress has provided whistleblowers a share of the recoveries to encourage people to take the personal and professional risks involved in reporting fraud.

How will the identity of the Whistleblower be protected?

Your False Claims Act case is filed under seal and remains sealed during the investigation. The purpose of sealing the lawsuit is to permit the government to conduct its investigation without interference from the defendants. Your False Claims Act lawsuit will typically remain sealed for several years and thus it is usually several years before the public is aware of the filing or the name of the whistleblower.

At the end of the seal period, the government decides whether to join the case. If the government joins the case, the lawsuit is unsealed, a copy is served on the defendant, and the government and the relator work together in the prosecution of the case. If the government declines to intervene, the relator may choose to prosecute the case on his own.

What is the timeframe for filing an IRS whistleblower claim?

The False Claims Act provides that only the first person to file a qui tam suit alleging the fraud can proceed. No court can have jurisdiction over a case where there is already another pending case on file involving the same fraud allegations. Therefore, it is critical that you are the first to file the lawsuit with your allegations of fraud. Lawsuits must generally be filed within six years of the date of the fraud.

What should you know when reporting fraud?

Do not discuss your case with anyone other than your lawyer and the prosecutors. Qui tam cases are filed under seal, meaning that they are not disclosed to anyone other than the government. If you violate the seal, your case can be dismissed.

You do not need to be a corporate insider or officer to file a qui tam suit. You do not need to be an employee to file a qui tam suit. Cases have been successfully brought by employees, customers, and competitors The False Claims Act provides that anyone who is aware of fraud on the government can file a qui tam case.

Make sure that your lawyer is qualified to evaluate any potential criminal exposure for your conduct and that you are adequately protected.

What should a whistleblower look for when hiring an attorney?

Choose a law firm with substantial experience in qui tam lawsuits. The False Claims Act is very complex and the law is evolving very quickly.

Your counsel should be familiar with the experience of the different U.S. Attorneys offices in prosecuting qui tam cases. It is important to know the strengths of the particular district where you case is to be filed.

Your counsel should be knowledgeable about these different court interpretations and know where to file the case to avoid negative court precedents and optimize your case results. Under the False Claims Act, the case may be filed in any locale where the defendant does business.

Depending on the case, expenses can cost hundreds of thousands of dollars and can take many years to prosecute. Make sure that your attorney has the resources to pursue qui tam cases.

You should choose an attorney who understands the importance of giving your case the attention it deserves.

How can I have an experienced qui tam attorney review my case now?

You can get a free consultation about your potential claim by filling out the form on the right of the page or by contacting our firm directly at 1-800-TAX-1712.

Contact us for a free case evaluation.