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Raleigh Criminal Defense Attorneys

Whistleblower, Qui Tam & False Claims Act


What is a whistleblower under the False Claims Act?

The term “whistleblower” under the False Claims Act refers to a person who reports fraud against the federal or state government. If the whistleblower’s accusations are found to have merit and the company is subsequently charged, the whistleblower will receive a portion of any recovered damages. A whistleblower who files a successful claim may receive between 15 and 25 percent of any recovery if the Attorney General intervenes in the matter. A whistleblower who successfully prosecutes the case on his or her own may receive between 25 and 30 percent of the amount recovered.

How are a whistleblower’s allegations handled?

A qui tam lawsuit may be brought under the federal False Claims Act (for activities such as Medicare and Medicaid fraud, defense contractor fraud, etc.) or the North Carolina False Claims Act (for such activities as false or fraudulent claims for payment to the state, misappropriated state property, etc.). Defendants found liable may be ordered to pay as much as three times the government’s losses plus penalties for each false claim. In addition to facing monetary penalties, individuals and companies can face exclusion from government programs (such as Medicare and Medicaid) and lose the ability to bid on government contracts as well as criminal liability for substantive violations.

The Dodd-Frank Wall Street Reform and Consumer Protection Act included new whistleblower provisions that apply to securities violations, accounting fraud, and bribery allegations raised by individuals against companies reporting to the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission, to include all securities law violations and not just frauds perpetrated against the government. The new law also significantly increased the potential financial rewards to whistleblowers. Employees who directly contact the SEC, for example, can receive between 10% and 30% of recoveries that exceed $1 million.

Whistleblower claims under the False Claim Act generally follow this procedure:

  • Any person who knows of government fraud may bring a claim on behalf of the defrauded government or agency.
  • The state or federal Attorney General can step in to prosecute the claim (although not required to do so).
  • If the government chooses not to intervene, the whistleblower may be allowed to continue prosecuting the matter on the government’s behalf and can receive a higher percentage of the recovery.
  • If your company has been accused of violations of the False Claims Act

    If your company has been accused of fraud against the federal or state government or other violations of the False Claims Act, our experienced team will walk you through the allegations and devise comprehensive defense strategies for resolving the situation as rapidly, efficiently, and cost-effectively as possible. Our skilled attorneys are often able to navigate the proceedings successfully in the early stages to avoid government intervention, but in the event the matter is not resolved, our trial team is well prepared to handle these issues in court.

    The Tharrington Smith Whistleblower Business Defense team includes attorneys skilled in both complex civil litigation and defending government investigations. Members of our team have decades of experience, including high stakes investigations and lawsuits brought by the federal and state government as well as private relators.Some of our firm’s recent Whistleblower Business Defense matters include:

    • Securing dismissal of a False Claims Act complaint alleging government contracting fraud.
    • Representing a former Lt. Governor, warehousemen and farmers in federal False Claims Act actions relating to agriculture programs.
    • Representing healthcare providers and professionals in connection federal and state False Claims Act investigations and actions.
    • Retaliation against a whistleblower

      Both the federal and state statutes make it illegal for employers to retaliate against the whistleblower for filing a claim or assisting the federal or state government with its claims. Such retaliation can result in reinstatement and double back pay with interest, costs and attorney’s fees. We can assist you in avoiding actions that may be misunderstood as retaliation.

Raleigh Criminal Defense Attorneys


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