False Claims Act

The False Claims Act (FCA) is a whistleblower reward statute.  If you know of private parties (such as government contractors) defrauding the government, you as a whistleblower may bring a court action, called a qui tam suit, and be awarded a portion of the damages if the case is successful.

There are also other federal whistleblower reward statutes, for tax, security and other types of fraud. 

In addition, 30 states have “Little FCAs” --these provisions can also be seen in the context of other state whistleblower laws.

Remedies against the Violator:

  • Civil penalties
  • Treble the amount of damages sustained by the government as a result of the fraud
  • Exclusion/debarment from government programs

Remedies for the Whistleblower:

  • 15 to 25% of the recovery if the government intervenes
  • 25 to 30% if whistleblower succeeds in a case which the government declines to pursue
    • However cases in which the government does not intervene are expensive and difficult to win
  • Attorneys’ fees

Role of the Whistleblower (“Relator” in FCA terminology):

  • Bring suit in the name of the United States
  • Assist by providing evidence, analysis, research

Anti-Retaliation Provision 31 USC 3730 (h) protects employees from retaliation for participating in false claims reporting, investigations, or law suits. 

Government Employees

Government employees are not specifically barred from filing a qui tam lawsuit against their own agencies but face resistance from the Justice Department and procedural hurdles to ensure they are not seeking to profit from doing their job (e.g., as a government auditor). Before considering a False Claims Act suit, government employees should first exhaust their agency’s fraud reporting requirements.

False Claims Act Proceedings

FCA suits have their own singular process, features and limitations.