Yesterday, the Department of Justice (DOJ) announced over $2.2 billion in recoveries from False Claims Act (FCA) cases in 2020, $1.6 billion of that sum arising from lawsuits filed under the qui tam, or whistleblower provisions of the FCA. Qui tam whistleblowers, or relators, received a total of $309 million for exposing frauds.
The Fiscal Year 2020 saw a decrease in the amount recovered from FY 2019 when the DOJ reported over $3 billion recovered from False Claims Act cases.
“Whistleblowers are the number one source of information on frauds,” said whistleblower attorney Stephen M. Kohn, partner at qui tam law firm Kohn, Kohn & Colapinto. “Reward programs like the FCA need to be expanded and improved in order to incentivize ‘insiders’ to risk their jobs and report criminal activity.”
The False Claims Act is one of the nation’s oldest laws and a key tool for detecting fraud committed against the federal government. The qui tam provisions of the False Claims Act empowers citizens, U.S. or non-U.S., to earn financial awards by reporting corruption and fraud.
Since Senator Charles Grassley led a successful Congressional effort in 1986 to amend the False Claims Act into the powerful whistleblower law it is today, relators have received almost $8 billion in awards.
Of the $2.2 billion collected by the DOJ in 2020, over $1.8 billion of it involved matters arising from the healthcare industry. One of the largest cases resulted in Novartis Pharmaceuticals Corporation paying over $591 million to resolve claims that it paid kickbacks to doctors to persuade them to prescribe its products.
Qui tam whistleblowers who file under the False Claims Act with original information of frauds can become eligible for awards if their lawsuit results in a successful sanction. There are no “caps” on the amount a whistleblower can receive. The award is determined by the quality of the information provided and ranges from 10-30% of the monies collected from the enforcement action.