Fraud is an unfortunate feature of business that every owner must deal with. Fortunately, well-intentioned employees notice more than their bosses do and come forward with observed accounts of fraud. This is known as whistleblowing, the act of reporting evidence of fraud or misconduct internally within a company or government.
Whistleblowing has a very real impact. Research shows that 65% of employees who observed wrongdoing reported what they’d seen, costing a typical company about five percent of its annual revenue. What’s more, about one in five corporate fraud cases reported in the United States between 1996 and 2014 was brought to light by a whistleblower — that’s 20% of corporate fraud cases over 18 years.
Whistleblower law firms exist to protect the whistleblower under federal and state law. Almost half of employees who see malpractice choose not to report it due to the fear of being retaliated against. No matter what, though, you need to say something when you see something wrong, which is also why you need the help of a whistleblower lawyer.
There are some benefits to reporting fraud, known as qui tam lawsuits. A qui tam lawsuit is a civil lawsuit brought by the whistleblower under the False Claims Act, and will reward the whistleblower if this action recovers funds for the government. These qui tam lawsuit procedures have helped the federal government recover $39 billion since 1987, with $4.2 billion paid directly to whistleblowers themselves.
The job of a whistleblower lawyer is to make sure the whistleblower is awarded the correct amount of money they deserve and to deal with the government, so the whistleblower doesn’t have to. If the government chooses to intervene in the case, the financial reward given to the whistleblower can amount to 15 to 25% of the recovery, and if the case is resolved without the government, the reward is a higher 25 to 30% of the return.
Violators of the False Claims Act are liable for up to three times the dollar amount that the government is defrauded and the civil penalty can be between $5,000 to $10,000 for each false claim. Whistleblower lawyers are incredibly important to ensure the legal process goes smoothly and that fraud is stopped in its tracks.
Have any questions? Contact a whistleblower law firm near you today!