Catching Crooked Companies: What Are The Benefits of Whistleblowing?
April 5, 2019
Famed economist Milton Friedman once said that “concentrated power is not rendered harmless by the good intentions of those who create it.” When it comes to business in America, most people expect corporations to pay their share of taxes as set forth by the law. But sometimes, the unscrupulous businessman will try to defraud the government to pad their bottom line and put more cash in their pockets. Sometimes it takes one brave person to stand up and call out the big money men for violating the law. These people are called whistleblowers.
How Do Corporations Commit Fraud?
Businesses commit fraud when they knowingly present a fraudulent claim for payment to the federal government, use false records or statements to get those claims paid, or use false records to conceal or avoid paying money to the federal government. All of these actions are illegal under federal law. The government has a number of watchdog organizations (such as the Securities and Exchange Commission) to catch fraudulent actions and punish the perpetrators, but sometimes a company hides their illegal actions so well that it takes an insider to bring them to light. These whistleblowers may be current or former employees, customers, vendors, or anyone who has original and credible information of the company’s fraudulent acts.
What Does A Whistleblower Do?
When that person files a claim against the offending company, he or she then becomes a whistleblower. It is not necessary to be personally harmed by the company’s actions, just that you know of substantial fraud and that federal funds are involved. The whistleblower then becomes part of a a qui tam suit, which is a civil lawsuit that is filed in their name under federal and state False Claims Acts. Sometimes, the Department of Justice will step in and become involved with the suit.
Sometimes whistleblowers get blowback. Personal hardships, media attention, and emotional turmoil can affect a person depending on the circumstances of the case and the fraud. Those who push on with the suits feel a moral responsibility to hold the lawbreakers accountable for their actions.
What Are The Benefits?
Although there may be stress involved, there are benefits to being a whistleblower. In addition to the ethical satisfaction, in some cases there is a financial benefit to being involved in a qui tam suit. Sometimes you can receive a portion of the funds the government recovers from the fraudulent party, sometimes up to 30%. Depending on the amounts the company is liable for, this could be a substantial amount of money.
The industries where fraud is more common is the medical industry, which can be rife with abuse of Medicare and Medicaid funds. Hospitals, nursing homes, home healthcare providers, pharmaceutical companies and even research organizations have been found to have engaged in fraud. Other industries which are notable for their fraud potential include banks and mortgage companies, defense contractors, environmental contractors, and low-income housing providers.
Know Of Potential Tax Fraud? Call Quinn Logue For Legal Advice Today!
If you think you you are aware of possible wrongdoing and believe that you have an actionable cause, you will need to find an attorney who is experienced. People throughout Pittsburgh come to our team for representation in legal malpractice and employment litigation cases. We will take the time to go over your options and get you the compensation you deserve. To learn more about the representation we may be able to offer you, schedule a free initial consultation. We can be reached through our online form or by calling 412-765-3800. We have offices located in the Waterfront Building in Pittsburgh as well as Scranton, PA. Contact us today!
The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.
