WHAT IS A WHISTLEBLOWER?
The term whistleblower means many different things to different people. To some, Edward Snowden of WikiLeaks fame is a heroic whistleblower. Other people think of tobacco whistleblower Jeffrey Wigand; still others think of securities industry whistleblower Harry Markopolous. All of these people are whistleblowers, yet none of them are qui tam whistleblowers. (Harry became famous as a qui tam whistleblower later, but that’s not how he initially got his fame.)
So maybe the best way to put it is to say that all qui tam relators are whistleblowers, but not all whistleblowers are qui tam relators.
WHISTLEBLOWER CASES
Both the federal False Claims Act (31 U.S.C. §3729 et seq.) and the Virginia Fraud Against Taxpayers Act (Virginia Code §8.01-216.1 et seq.) have qui tam provisions that allow any person with non-public information about fraud on the government to prosecute a case in conjunction with the government.
These cases—sometimes called “whistleblower cases“—frequently arise out of the employment relationship, when an employee with knowledge of fraud decides to seek legal advice, but all kinds of people may have the types of information on which a qui tam case is based. We have, for example, represented business-owners who brought cases against their competitors after refusing to join a kickback scheme.
The federal False Claims Act and the Virginia Fraud Against Taxpayers Act create strong penalties against those individuals and organizations that make false claims in order to receive money, but strong penalties alone are not enough.
It is well known that corporate and individual compliance with the requirements of any law–regardless of whether we are talking about parking violations or serious crimes like murder–are governed by the same basic considerations.
In no specific order, those general requirements are:
- the likelihood that transgressions of the law will be detected;
- the likelihood that observed transgressions will be prosecuted;
- the substance of the behavior the law forbids;
- the nature and quality of the evidence required to prove a violation; and
- the severity of the potential sanctions.
OUR STATE AND FEDERAL GOVERNMENTS
Our state and federal governments have been quite good at addressing factors three through five. To address factors one and two, however, the help of private citizens and lawyers is necessary, and that is why false claims act legislation creates rewards and incentives to encourage individuals to come forward and to encourage lawyers in private practice to handle these cases. Companies or individuals who violate the False Claims Act are liable for up to three times the total dollar amount of the fraud, plus an additional penalty ranging from $10,781 to $21,562 for each false claim submitted to the government, plus payment of the relator’s attorney’s fees and litigation costs.
