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The False Claims Act: Protection and Compensation for Whistleblowers

Private companies have been doing business with the federal government since the beginning of the Republic. More and more services that used to be performed by the government are being farmed out to contractors, and the size of contracts can be in the hundreds of millions of dollars. Sadly, however, for as long as there have been government contracts, there has been fraud against the government.

Given the importance of rooting out such fraud, the federal government relies in part on individuals outside the government to put them on notice of any fraudulent activity. If you work for a company or organization that contracts with the government and you suspect your employer is involved in fraudulent activity, whistleblower laws (also called qui tam laws) can provide you with protection from retaliation as well as a share in any damages recovered.

From Civil War Profiteers to Medicare and Medicaid Fraud

During the Civil War, businesses that provided the Union Army with weapons and other supplies were taking advantage of the chaos and upheaval of war to make a profit at the government’s expense. For example, a gun manufacturer might fill an order for 500 rifles and only deliver 450. With a war fought on such a large scale – in a time of poor communication to boot – it was easy for the government to overlook missing items. As a result, dishonest companies kept the extra 50 rifles and pocketed the money.

The False Claims Act, codified at 31 U.S.C. §3729 et seq. put a stop to this by giving private individuals the ability to bring lawsuits on behalf of the federal government. This law still exists today. To reward citizens for their honesty and efforts, the statute allows the informant (or “relator” as they are sometimes called) to share anywhere between 15 to 30 percent of the judgment.

At first glance, you might not think your company has any interaction with the government. What most people don’t realize is that nearly every business entity has some sort of government relationship, whether it involves adhering to regulations, billing for services, purchasing equipment, or submitting invoices for payment. Bribes and kickbacks are obvious examples of fraud. Creating false records, keeping phantom employees on the books, failing to refund overpayments, or misrepresenting the quality or quantity of a product may also qualify as false claims.

In recent years, the health care and pharmaceutical industries have come under heavy scrutiny for violation of government regulations. Medicare fraud is an especially widespread problem, along with off label marketing and collusive bidding. When health care providers and insurance companies cheat, it increases the cost of health care for all of us. If enough corporations engage in illegal activity, everyone pays a higher price. This is why it’s important for employees to speak up when they notice inaccurate or fraudulent practices. In Louisiana, the Medical Assistance Programs Integrity Law allows whistleblowers to bring suit in the name of the state of Louisiana where a wrongdoer engages in conduct that defrauds the state or local government of its healthcare dollars. This statute is designed to address Medicaid fraud.

In today’s marketplace, fraudulent schemes and illegal billing tactics are much more complex than the Civil War era rifle example. Modern fraud often involves enormous amounts of paperwork, money, and electronic transactions that can be difficult to prove and trace. Additionally, a lone employee working for a large corporation could be understandably reluctant to pull the trigger on his or her suspicions. This is why the whistleblower laws protect employees who are demoted, suspended, threatened, harassed, or in any way discriminated against by an employer as a result of reporting this type of fraud. Today, 28 states also have whistleblower laws on their books, so employees of companies who do business with state-level governments may be able to bring a successful claim as well.

Call Galante & Bivalacqua if You Have Whistleblower Questions

If you are considering speaking up against fraud, it’s important to hire a law firm with significant experience bringing whistleblower cases. Choosing the right attorneys can make or break your case. In this type of situation, when employer retaliation is a concern, you want skilled whistleblower attorneys on your side. At Galante & Bivalacqua in New Orleans, we have extensive knowledge of the intricacies posed by whistleblower laws under the federal False Claims Act as well as Louisiana’s whistleblower law. Contact us today at (504) 648-1858 to speak to a seasoned attorney who can assist you with these issues.

This website has been prepared by Galante & Bivalacqua for informational purposes only and does not, and is not intended to, constitute legal advice. The information is not provided in the course of an attorney-client relationship and is not intended to substitute for legal advice from an attorney licensed in your jurisdiction.