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Volume XII, Number 181

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The Top Pros and Cons of Becoming a Whistleblower in a Qui Tam Lawsuit

If you come across information that leads you to suspect fraud or corruption is taking place, you may be wondering what exactly to do about the situation. Deciding to speak up can be a difficult decision at times, with peer pressure and other concerns vying against your own values and respect for the truth. Whether at your workplace, a health care institution, or another environment, many bureaucratic hurdles may be in your way as you grapple with the decision ahead of you.

In order to decide what to do with the information you have come across, it may be useful to consider the pros and cons of becoming a whistleblower in a qui tam lawsuit so that you can make an informed and confident decision.

Weighing the Odds in a Qui Tam Lawsuit

There are certain legal protections whistleblowers are entitled to under federal law, as well as some limitations to what the law can mandate. The complete protection and provisions provided to a whistleblower, also known as a “relator,” are laid out in the False Claims Act. This law, first passed by President Lincoln in 1863 and then amended in 1943 and 1986, provides powerful incentives to prevent corruption, as well as to support those who come forward with information. It is one of the strongest and oldest anti-fraud laws in the United States.

To weigh your next steps in a whistleblower situation, you may want to consider the following pros and cons.

Top Pros of Becoming a Whistleblower

Financial Incentive

The Department of Justice received over $5.6 billion in settlements and judgments from civil cases involving allegations of corruption and fraud in the fiscal year of 2021 alone. Those who come forward with information receive a percentage of what the government recoups in any qui tam case. A typical payout in a qui tam lawsuit can be between 15 to 30 percent of the amount collected by the federal government in a successful case. Even more significantly, there is no cap on the amount that a whistleblower may be awarded in a qui tam lawsuit.

With many cases involving payouts in the millions, becoming a whistleblower can be extremely lucrative. For example, in 2019, the Department of Justice reported that qui tam whistleblowers received $272 million in total rewards for that year alone.

Legal Protection

The False Claims Act provides powerful protection for whistleblowers against retaliation. It is illegal to fire or take any other kind of adverse action against an employee for taking part in protected activity, of which reporting issues is one. Some protected issues to report on include (but are not limited to):

  • Employee safety

  • Environmental protection

  • Health insurance

  • Minimum wage

  • Fraud or corruption

  • Consumer product or food safety

  • Family or medical leave

  • Discrimination

Satisfaction of Doing What is Right

Many whistleblowers report a sense of satisfaction after following their own moral compass. Regardless of pressure to stay silent, if you feel a situation is wrong, speaking up can be its own reward.

Preventing Waste

As a taxpayer, efforts to defraud the government indirectly harm you and your family. Government spending is fueled by tax dollars, and efforts to cheat the system only harm those who contribute to it honestly.

Deterring Further Fraud

Whistleblower lawsuits can discourage future fraud. They can help bring corruption to light, and ensure that future activity is fair and above board.

Top Cons of Becoming a Whistleblower

Delays

Compiling the evidence, bringing a case to trial, and awaiting a verdict can be a lengthy process. These delays can be particularly extensive in qui tam lawsuits, which often involve navigating complex bureaucratic systems and reporting to the federal government. Some qui tam lawsuits can take three to five years before they are finally decided, according to a recent Forbes analysis.

Lack of Understanding

Even though the law prohibits retaliation in whistleblower cases, deciding to speak up can still sometimes cause consternation or pushback amongst coworkers, friends, or family. Not everyone may understand the impulse to speak up. Whistleblowers can sometimes face criticism or cold shoulders while the process unfolds.

Complex Process

Becoming a whistleblower can take time away from other areas of your life, as you find yourself navigating a lawsuit and documenting someone else’s wrongdoing.

Deciding What to Do in a Qui Tam Lawsuit

Pursuing the truth is often its own reward, but there are also financial incentives offered to whistleblowers as well as protections available. Deciding to speak up can be an important decision, with potentially millions of dollars at stake as well as concerns about highlighting and addressing wrongdoing.

© 2022 by Tycko & Zavareei LLPNational Law Review, Volume XII, Number 47
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About this Author

Jonathan K. Tycko leads the Whistleblower Practice Group of Tycko & Zavareei LLP

In recent years, the laws of the United States have undergone a whistleblower revolution. Federal and state governments now offer substantial monetary awards to individuals who come forward with information about fraud on government programs, tax fraud, securities fraud, and fraud involving the banking industry. Whistleblowers also now have important legal protections, designed to prevent retaliation and blacklisting.

The law firm of Tycko & Zavareei LLP works on the cutting edge of this whistleblower revolution, taking on even the most complex and confidential whistleblower...

202-973-0900
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