Articles Tagged with Whistleblower

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false claims act

Qui Tam Whistleblower

One thing we cannot stress enough as attorneys for relators in False Claims Act cases is to respect the seal.  As you may know from reading this blog, the False Claims Act requires that any case filed by a qui tam whistleblower has to remain under seal for at least 60 days to give the government an opportunity to investigate the claims and decide whether it wants to intervene and run the case on its own.  As we have previously explained, violations of the seal are serious, and if the relator (or his or her attorney) discloses the existence of the lawsuit to a third party, that individual could face sanctions, including dismissal or contempt of court.

False Claims Act

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Tax Fraud Whistleblower

Every year, people and companies in the United States cheat on their taxes.  The IRS has a special term for the amount of taxes that go unpaid each year.  It’s called the “Tax Gap,” which means the amount of true tax liability faced by taxpayers that is not paid on time.

The IRS estimates the annual Tax Gap to be $450 billion. Wow!  Forget about raising taxes, just think of the problems the Government could solve if it just collected the taxes that people actually owe right now.

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medicare fraud
In the world of False Claims Act qui tam cases, the concept of medical necessity is a very big issue.

Medicare Fraud

This is because Medicare requires, as a condition of coverage, that services delivered to a patient be “reasonable and necessary for the diagnosis or treatment of illness or injury.”  See 42 U.S.C. § 1395y(A)(1)(a).  Healthcare providers who wish to participate in the Medicare program must ensure that their services are provided “economically and only when, and to the extent, medically necessary.”  See 42 U.S.C. § 1320c-5(A).  In other words, Medicare only pays for services that are “medically necessary.”

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False Claims Act Cases

The Department of Justice recently announced its tally of total recoveries for 2016 under the False Claims Act.   The government recovered an astonishing $4.7 billion during this time.

The DOJ press release shows the following trends.

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Anyone reading this blog probably knows that we represent whistleblowers who file so-called “qui tam” cases under the False Claims Act.  The term “qui tam” is a Latin term derived from the longer and ancient legal expression “qui tam pro domino rege quam pro se ipso in hac parte sequitur,” meaning one “who pursues this action on our Lord the King’s behalf as well as his own.”  In short hand, that means an action brought by a private citizen on the government’s behalf, whereby the government and the individual will share in any of the money recovered.  The False Claims Act is one of the few provisions in federal law that allows a private citizen to file a case on behalf of the government.

Qui Tam Cases

Because qui tam actions are brought on behalf of the government, the government is the “real” plaintiff in the case, and the whistleblower or “relator,” is functioning more like a private attorney general.  As a result, the False Claims Act requires that the government have a shot at pursuing the case on its own.  To give the government this opportunity, when a relator files a case, it must be filed “under seal” for a period of at least 60 days.  That means that the existence of the case remains secret and cannot be disclosed without the court’s permission to anyone other than (a) the relator, (b) the court, and (c) the government.

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whistle  A whistleblower is a person who reports fraud, corruption or other wrongdoing, usually, but not always, at their place of work.  Most states have laws that protect whistleblowers and prohibit employers from firing, demoting or retaliating against whistleblowers.

When a whistleblower sees fraud committed against the government, he or she has the opportunity to become a qui tam whistleblower under the False Claims Act, which is a federal law that encourages whistleblowers to report fraud and thereby receive a reward for their efforts.

We often get the question, “How do I become a whistleblower?”

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A study done by the National Contract Management Association revealed that in 2014, at close to three billion dollars, the Department of Defense accounted for two-thirds of the nation’s corporate contract spending.  This vast amount of money, however, provides ample incentive for dishonest contractors to bilk the government and taxpayers, and potentially put the lives of U.S. military members at risk.  One defense against these unscrupulous fraudsters is the False Claims Act.

During the Civil War, dishonest contractors sold the Union Army decrepit horses, faulty weapons, and rancid food. In response, Congress passed the False Claims Act on March 2, 1863. Abraham Lincoln was President when the False Claims Act was passed and it is sometimes referred to as the “Lincoln Law.”

The False Claims Act permits private individuals to bring lawsuits on behalf of the government for the fraudulent conduct.  The qui tam provision of the False Claims Act provides that the whistleblower who brings the action may share in any recovery by the government.

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Book Review: Grisham’s “The Whistler” by Florida Business Attorney Adam Rabin

downloadThe hype is upon us with the release of John Grisham’s new legal thriller, “The Whistler.”   While it feels like yesterday when I was a law student and could not stop turning the pages of “The Firm,” I am particularly excited for Grisham’s new release in a different way.  First, this Grisham novel is set in Florida.  Second, Grisham focuses on one of my firm’s areas of practice: whistleblower law.  Here is how Amazon has summarized the book:

This book may be the “most electrifying novel of the year, a high-stakes thrill ride through the darkest corners of the Sunshine State.”  The book speaks to how our judges are expected to be honest and wise and that their integrity and impartiality are the keys to our judicial system.  The judicial system, however, is shaken when a judge takes a bribe.

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On August 30, 2016, the Treasury Inspector General for Tax Administration issued a report following an audit of the IRS Whistleblower Program. The audit was conducted to determine whether whistleblower claims are being appropriately and timely processed for investigation and examination.   The report confirms much of what lawyers who practice in this area already know.

First, the report confirmed that the program has the potential for great success.  From fiscal year 2011 through 2016, the IRS collected more than $2 billion of unpaid taxes based on information reported by whistleblowers.   While this sounds like a great success, lawyers who practice in this area, such as McCabe Rabin, P.A., believe this is just the tip of the iceberg.

The report also confirmed a number of problems with the IRS whistleblower program, most notably, the IRS’s failure to contact whistleblowers to clarify allegations and the IRS’s failure to have proper supervision and oversight to make sure that whistleblower claims are timely processed and referred for examination.  The report makes 10 specific recommendations for improving the manner in which the IRS receives, processes, and handles IRS whistleblower complaints.

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How do you know if you have a Qui Tam Case?

Under the False Claims Act, persons who know about fraud against the federal government can receive a reward for reporting that fraud and helping the Government recover money from the wrongdoer.    We receive many calls from potential whistleblowers who wish to report serious fraud against Government.  Unfortunately, we cannot take every case where fraud exists.   Here is a list of sample questions to help you determine whether you might have a potential False Claims Act qui tam case.

  1. Does your employer do business with the federal or state government?  This would include Government vendors or contractors as well as healthcare companies that receive payment from Medicare or Medicaid.