Many businesses have dealings with the federal government that involve the government paying them for goods and services. For instance, any hospital or doctor’s office likely files claims for reimbursement to Medicare, Medicaid and other federally-funded insurance programs like Tricare, which provides health insurance to military personnel and their families.

Likewise, many companies may supply all kinds of goods and services to the federal government, from those who work on federal military or construction projects to those who sell food products to a federal agency. Also, some institutions and businesses obtain grants from the government. In addition, some businesses owe money to the government, such as for import duties or mineral rights.

To prevent those who sell their products and services to the federal government from submitting false or inflated bills, and to prevent businesses that owe the government money from hiding those expenses, the government enacted The False Claims Act and has amended it several times since 1986 to enhance the role of the Whistleblower. Basically, for any false claim, the government has the right to recover triple their actual damages as well as and up to more than a $21,000 penalty for each claim, along with costs and fees.

Where do employees come in?

The False Claims Act allows employees to file what are called qui tam actions and rewards them for it with Whistleblower shares of 15% to 25% if the government intervenes and from 30% to 35% if the government does not. A qui tam action allows a private citizen, including an employee of a government contractor, a vendor, or a competitor, or anyone with sufficient knowledge, to file a complaint on the government’s behalf to collect funds for the Taxpayers.

The definition of a false claim is pretty broad. It of course includes outright fraud, such as when a contractor bills the federal government for work it never performed or goods it never provided. However, the all-too common practice of padding one’s bill, presumably because the government will pay it anyway, could also lead to a lawsuit under the False Claims Act. Also, many False Claims are for sophisticated schemes involving up-coding and kickbacks, co-pay waivers or 3rd party co-pay coverage, drug dispensing schemes, or billing for medically unnecessary therapy, tests, or other medical services.

A contractor who provides goods that are defective or of lower quality than agreed could also be subject to legal liability. Basically, if an employee witnesses their company or a competitor or vendor engaging in questionable business practices that exploit the federal treasury, then they can consider filing a qui tam action.

What are some types of qui tam actions?

Cross Law Firm, S.C., is nationally known as a pioneer in this field.  CLF has obtained millions for the Taxpayers with “firsts” in recoveries for hospice fraud, for Medicare Part D fraud, for fraud based on violations of the Controlled Substances Act, and for achieving repayment to falsely paid employees on government contracts when the fraudster was forced to plead to felony fraud against the government.

What benefit does an employee receive for reporting?

Aside from knowing that they did the right thing, an employee or other individual whose attorney files a qui tam action on behalf of the government is also eligible for a monetary award. For instance, if the government declines to prosecute the case itself, then the employee can receive up to 30% of whatever damages and penalties the court awards and can also recover attorney fees and expenses.

If the government does pick up the case after reviewing it, the employee, called a relator, can still recover up to 25%. Of course, there are some exceptions to these rules, so call Cross Law Firm, S.C., to find out if you can pursue such a case, as the firm has obtained millions for Taxpayers and, in many cases, millions for their clients as well.