In my experience as a former federal prosecutor, one of the most intricate and impactful aspects of defending clients against qui tam actions is addressing whistleblower bounties under the False Claims Act (FCA), codified at 31 U.S.C. § 3729-3733. A significant challenge for defendants is not only to refute the allegations but also to mitigate the financial repercussions, which can be substantial due to the statutory provision allowing whistleblowers to receive up to thirty percent of any recovery under the FCA. This article aims to provide insights into how to strategically approach whistleblower bounties and protect your client's interests.
The qui tam provisions, found in 31 U.S.C. § 3730, enable private individuals to file lawsuits on behalf of the government against companies or organizations accused of defrauding federal programs. These whistleblowers are entitled to a portion of any recovery as an incentive for reporting fraud. When defending against such claims, it is crucial to not only challenge the substantive merits of the allegations but also to scrutinize the whistleblower’s eligibility and the potential amount of their bounty.
In practice, prosecutors often look for ways to enhance the financial incentive for whistleblowers by maximizing the recovery under the FCA. This can lead to situations where defendants face exorbitant penalties that go beyond merely addressing the fraudulent conduct itself. As a defense attorney, one must be prepared to contest not only the validity of the fraud allegations but also the appropriateness and legality of the whistleblower's requested bounty.
Former Federal Prosecutor Insight
In prosecuting qui tam cases, it is crucial to understand that the whistleblower's bounty can be a significant factor in motivating and sustaining their pursuit of litigation. As defense counsel, you must be vigilant about identifying any procedural or substantive issues with the whistleblower’s eligibility for a reward, such as improper timing of filing or lack of original information.