Frequently Asked Questions
Our lawyers are experienced in whistleblower cases. We have put together some of our most frequently asked questions here. If you have questions that aren’t covered, feel free to contact us.
This isn’t a substitute for legal advice. Each and every whistleblower case is different. To discuss your individual situation, request a free consultation now.
Table of Contents
Whistleblower Cases 101
What is a whistleblower claim?
What are some examples of whistleblower cases?
- Cheating clients, customers and/or employees by manipulating financial records (“cooking the books”)
- Taking money from customers for products or services that the company can’t or won’t deliver
- Overcharging for medical procedures, charging for procedures that weren’t done, or even performing unnecessary medical procedures in order to get more money from Medicare or Medicaid
- Overcharging for products sold to government agencies, programs or the military
- Falsely claiming Disadvantaged Business Enterprise (DBE) status in order to get government contracts
- A company endangering public health and safety (for example, by using faulty or untested parts or ingredients in its products in order to save money or increase profits)
- Making false claims about the benefits or effects of a drug in order to get more sales (for example, promoting a prescription drug for a purpose not approved by the FDA)
- Insider trading
- Ponzi schemes
- A company cheating on its taxes and/or lying about its financial situation
- Lying about how much a product, service or investment opportunity is worth in order to get people to buy it
- Falsely claiming a product is Made in the USA when it’s not (consumer fraud)
- Lying about what a product is to get a better customs rate (customs duty & tariff fraud)
- PPP loan fraud
- Bribery of foreign government officials to get or keep business
What’s involved in filing a whistleblower claim?
The exact process depends on the type of whistleblower case (for example, if it involves fraud against the government, tax fraud or financial/securities fraud). Still, the basic process is the same.
A whistleblower attorney helps ensure you have the right kind of evidence to file a claim, and assists in submitting the claim effectively through the proper channels. If the case goes forward, you and your attorney will likely meet with government officials and attorneys. There will likely be a long investigation period that could last months or even years.
If the government successfully recovers damages, you may be eligible for a portion as a whistleblower award.
Do you have to be a current or former employee of the company to be a whistleblower?
No. Almost anyone with evidence of fraud or law-breaking can be a whistleblower. You don’t have to be a current or former employee of the company committing the wrongdoing.
Do you have to have witnessed the wrongdoing firsthand, or have documentary evidence, to be a whistleblower?
No, though it can make for a stronger case depending on the type of claim.
Can you stay anonymous as a whistleblower?
Filing a whistleblower claim is typically confidential. But, depending on the type of whistleblower case and how that case goes, it may not be possible to remain anonymous throughout the entire process.
For example, if the government has to go to court against the company, the whistleblower’s information and identity may have to be revealed. The company may also be able to figure out the whistleblower’s identity based on the information provided.
If you think you have a whistleblower case and are worried about privacy or retaliation, it’s best to talk with a whistleblower attorney.
Can you be a whistleblower if you participated in the fraud or wrongdoing?
Many whistleblower cases come from people who didn’t know at first that the activity was illegal, or who were participating at the direction of their boss. These people often have access to information needed to stop the wrongdoing, and so the law recognizes the importance of helping them come forward.
Whistleblowers who participated in the wrongdoing may get a reduced whistleblower award if they were heavily involved. Still, they typically still receive an award unless they planned or initiated the fraud, or are convicted of a related crime.
Can you blow the whistle if you already reported internally?
It is common for whistleblowers to have tried (often for months or even years) to stop the wrongdoing from within before finally deciding to take it outside the company.
Usually any prior reporting internally doesn’t prevent you from filing a claim and receiving an award through a whistleblower program. This is something to discuss with a whistleblower attorney.
What are the pros and cons of being a whistleblower?
This answer is different for everyone.
There are potential financial awards for whistleblowing, and apart from that, many whistleblowers feel deeply gratified and often justified by helping right a wrong. There is a great sense of accomplishment and relief in finally bringing the wrongdoing to light.
But, on the other hand, the process can be long and sometimes frustrating. Some whistleblower cases take years. Whistleblowers typically can’t share about the case with anyone except their attorneys and the government agency involved, which can be challenging. While there are laws to protect whistleblowers, there is still the risk of retaliation (loss of job, demotion, harassment at work, etc.)
Whistleblowing shouldn’t be done lightly. It’s best to speak with a whistleblower attorney to get a fuller picture of the possible pros and cons.
False Claims Act FAQ (Fraud Against the Government)
What is the False Claims Act?
The False Claims Act (FCA) is a federal law that takes action against contractors and companies that commit fraud against the government. Common targets of fraud are Medicare, Medicaid and the military.
The FCA is one of the main tools the federal government has to combat fraud, and it covers many types of whistleblower cases. It’s a very broad law. If you think you may have a whistleblower case, it’s a good idea to consult with an attorney.
Do Medicare and Medicaid fraud fall under the FCA?
Yes. Medicare and Medicaid fraud cases are some of the most common cases brought under the FCA. This type of fraud can involve healthcare providers or medical product providers overcharging for procedures and medical devices, charging for procedures that weren’t done, or even performing unnecessary medical procedures in order to get more money from Medicare or Medicaid.
There are other types of healthcare fraud that fall under the FCA. Some of the biggest FCA claims are against drug companies that make false claims about their products, such as promoting them for “off-label” use not approved by the FDA.
Do procurement fraud, defense contractor fraud and set-aside contract fraud fall under the FCA?
Yes. Procurement fraud cases are common under the FCA. This involves deliberately overcharging or otherwise cheating a government agency or the military for contracted products or services. Defense contractor fraud and set-aside contract fraud fall under the procurement fraud umbrella.
Procurement and defense contractor fraud can involve:
- Cross-charging (shifting costs from a fixed-price contract to a cost-plus contract in order to boost profits)
- Substituting cheaper materials, products or parts without permission in order to increase profits
- Shifting costs from other contracts onto U.S. government contracts (so the U.S. government pays for work done for other customers)
- Overcharging and deliberately inflating costs
- Knowingly, or through reckless negligence, delivering a substandard product that could cause harm
“Set-aside contract fraud” involves falsely claiming Disadvantaged Business Enterprise (DBE) status in order to get government contracts. The government “sets aside” a percentage of its contracts for small, minority-owned, women-owned, veteran-owned and service-disabled-veteran-owned businesses. This helps level the playing field for DBEs that otherwise would not be able to compete against long-established large businesses.
Set aside contract fraud can involve:
- Setting up a “shill” or “front” company that meets the DBE requirements, then passing the actual work to a non-qualifying business
- Misrepresenting company size or earnings
- Misrepresenting minority/woman/veteran/service-disabled-veteran ownership or controlling interest
- Manipulating the company structure to make it appear that a minority/woman/veteran/service-disabled-veteran is involved in the running of the company when they are not
This cheats legitimately qualified DBEs out of their rightful opportunities and gives an unfair advantage over businesses following the rules.
What is the qui tam provision of the FCA?
The FCA includes what’s called a qui tam provision that allows people who aren’t affiliated with the government to file a lawsuit on the government’s behalf. These people are called “relators” or “whistleblowers.” The law allows this because the government can’t possibly oversee all the companies and contractors that supply products or services to its agencies. It relies on people within those companies who have evidence of fraud to take action. Most FCA cases are initiated by whistleblowers, with the help of attorneys.
If it’s proven that the company did commit fraud, they must pay damages. The goal of the FCA is to recover lost money and punish companies so they won’t commit fraud again. Violators are typically liable for three times the dollar amount the government was defrauded, plus civil penalties.
Is there an award for whistleblowing under the FCA?
The whistleblower can be awarded a percentage of the recovered damages if the case is successful or results in a settlement.
Is there any help for whistleblowers who are fired as a result of an FCA claim?
Whistleblower employees who are fired, demoted or harassed because of lawful actions they take under the FCA are entitled to be “made whole” under the law. This may include getting their job back, double back pay, and/or compensation for litigation costs and attorney fees.
What about fraud against state governments?
The FCA is a federal law, but 31 states have similar laws on the books. Some states provide a “finders fee” for whistleblowers who report contractor fraud against state or local governments.
Dodd-Frank SEC & CFTC Whistleblower Program FAQ (Fraud Against Investors)
What is the Dodd-Frank SEC & CFTC Whistleblower Program?
The Dodd-Frank Act is a huge piece of legislation that was signed into law following the financial crash of 2008. Its purpose is to prevent similar crashes by making financial institutions more transparent and accountable.
The Dodd-Frank Whistleblower Program allows whistleblowers to file a complaint with the U.S. Securities and Exchange Commission (SEC) or the Commodity Futures Trading Commission (CFTC), alleging that a person or company violated federal securities or commodities law. Once the complaint is filed, it’s up to the agency to investigate.
Unlike the FCA, a whistleblower can’t file their own lawsuit on behalf of the government. It’s totally up to the SEC or CFTC to take action.
Is there an award for whistleblowing under the Dodd-Frank SEC & CFTC Whistleblower Program?
If the SEC or CFTC confirms the complaint and sanctions the person or company for $1 million or more, the whistleblower is typically entitled to a percentage of the recovery. If the SEC or CFTC doesn’t take action or the sanction is below this amount, the whistleblower isn’t usually entitled to an award.
The whistleblower must have provided original information (not already known by the investigating agency) in order to be eligible for the award. There are some other possible exclusions, too, that are best to discuss with an attorney.
Is there any kind of protection for whistleblowers under Dodd-Frank?
Whistleblowers can file a claim anonymously, but have to disclose their identity to the SEC or CFTC if it’s determined they’re eligible for an award. This can be done through an attorney.
The law prohibits retaliation against employees who file a claim and/or help with the investigation. However, the law doesn’t extend to whistleblowers who file internally within their company. For better protection, it’s recommended that whistleblowers file an official claim under the Dodd-Frank law.
IRS Whistleblower Program FAQ (Tax Fraud)
What is the IRS Whistleblower Program?
The IRS allows whistleblowers to report tax fraud, tax avoidance, violations of tax law or underpayment of taxes by a company or individual.
Is there an award for whistleblowing under the IRS Whistleblower Program?
Whistleblowers who provide original information that results in a recovery may be eligible for a monetary award under IRS whistleblower law.
In small cases (the amount in dispute is $2 million or less; gross income of $200,000 or less for an individual) the IRS decides whether or not to give an award. It’s completely up to their discretion.
For large cases involving more than $2 million, the whistleblower awards are mandatory under the law. The whistleblower is eligible to receive a percentage of the amount recovered by the IRS. The recovery can include not only the taxes owed, but penalties, interest, and even related criminal fines and civil forfeitures.
Is there any kind of protection for IRS whistleblowers?
The initial claim can’t be made anonymously, but the IRS must protect the identity of the whistleblower “to the fullest extent of the law.”
There is no specific anti-retaliation provision in the IRS law. If a whistleblower suffers a financial loss as a result of the whistleblowing action (such as being fired or demoted), the whistleblower award is the only remedy. Some states do have laws that help protect tax whistleblowers. It’s best to discuss these concerns with a whistleblower attorney.
Foreign Corrupt Practices Act FAQ (Bribery of Foreign Officials)
What is the Foreign Corrupt Practices Act?
The Foreign Corrupt Practices Act (FCPA) is a powerful transnational anti-corruption law. It targets corruption in two ways:
- Prohibiting bribery of foreign officials in order to gain a business advantage
- Setting requirements for bookkeeping, internal accounting controls and audits to prevent “under the table” dealings
The FCPA is a broad law that applies worldwide. If you believe you may have a FCPA whistleblower case, it’s best to consult an attorney.
Who does the FCPA apply to? What is an “issuer?”
The FCPA applies to U.S. or foreign public companies that:
- Are listed on a national securities exchange in the U.S. (either stock or American Depository Receipts) or
- Have their stock traded in the over-the-counter market in the U.S. and are required to file SEC reports
These companies are called “issuers” under the FCPA. Not only does the law apply to issuers, but their subsidiaries, officers, directors, employees, agents and shareholders.
Who are “foreign officials” under the FCPA?
Under the FCPA, “foreign officials” can include:
- Any officer or employee of a foreign government agency, department, or public institution acting on behalf of the government
- Foreign political party officials or candidates
- Foreign military members in charge of the employees, officials and contracts of government-owned or controlled entities
It is also a violation of the FCPA to bribe a foreign official indirectly—for example, giving bribe money to a third party who will pass it along.
What is considered a bribe under the FCPA?
A bribe can be money or anything of value to the bribed individual. Examples include cash, cars, designer clothing, electronics and medical supplies. Not all gifts are bribes. The more expensive and extravagant the gift, though, the more likely it is to be a bribe.
The purpose or intent matters. A bribe is paid in order to gain a business advantage. Examples include:
- Winning a contract or business
- Preventing the loss of a contract or business
- Getting access to “non-public tender information”
- Influencing the procurement process
- Getting exceptions to regulations
- Violating import rules
Bribery can be difficult to prove, since it typically happens in secret. That’s why the FCPA also covers bookkeeping and auditing. Even if the U.S. government can’t prove bribery, issuers can be held liable for improper payments that weren’t recorded accurately.
What are some FCPA violations that have to do with bookkeeping and audits?
Under the FCPA, issuers must have strong internal controls. This is to prevent off-book accounting that can cover up “under the table” deals, payments and bribes.
Examples of FCPA violations include:
- Failure to implement internal controls
- Failure to keep accurate books and records
- Failure to implement sufficient anti-bribery policies
- Failure to maintain sufficient systems for selecting and approving consultants
- Failure to conduct appropriate audits of payments
Issuers can be held liable for failing to comply with the FCPA regulations if it’s proved they acted “willfully.” In other words, if they deliberately used off-book accounting to cover up illegal or improper activity.
Is there an award for whistleblowing under the FCPA?
Is there any kind of protection for FCPA whistleblowers?
It is possible to remain anonymous and still be considered for an FCPA whistleblower award. An attorney must represent the whistleblower and submit information on their behalf.
FCPA whistleblowers are protected from employer retaliation by the Dodd-Frank Act and the Sarbanes-Oxley Act. Whistleblowers who are retaliated against can report the violation. They could be eligible for reinstatement, back pay and other compensation.