Kohn, Kohn & Colapinto has been serving False Claims Act whistleblowers for over two decades, and helped shape SEC and CFTC whistleblowing rules

When considering a New York whistleblower lawyer, you need someone you can trust. An experienced and fearless ally who knows how to take on large corporations and Wall Street as well as wealthy fraudsters. An ally who is experienced in the intricacies of whistleblower reward programs and has a proven track record of fighting white-collar crime and fraud against the government and taxpayers. Our firm provides representation under the following acts:

Having worked extensively with the SEC Office of the Whistleblower, the CFTC Office of the Whistleblower and IRS Whistleblower Office since their inception, and lititgated numerous False Claims Act Cases, we have intimate knowledge of whistleblower reward laws. We’ve ensured those risking their lives and careers can come forward confidentially, or even anonymously as permitted, and be compensated for their brave actions.

Take our client Bradley Birkenfeld for example, a UBS banker who blew the whistle on Swiss banking, illegally helping US taxpayers hide their money. This resulted in 4,450 off-shore accounts being reported to the US government. Birkenfeld received the largest award given to an individual whistleblower $104 million, at that time.

If you need a New York whistleblower lawyer for aggressive whistleblower representation, get in touch with us today for a confidential case evaluation.

What is the New York False Claims Act?

The New York’s False Claims Act is modeled on the federal False Claims Act, but it has some significant differences that are beneficial to whistleblowers. Each state has its own rules and regulations regarding filing a state qui tam whistleblower reward case. But to facilitate filing a state qui tam case, Congress amended the federal False Claims Act to make it relatively easy to include New York claims as part of a federal qui tam lawsuit.

Under the New York False Claims Act whistleblowers can file a qui tam lawsuit under state law by filing a complaint in the appropriate Supreme Court (in New York the local trial courts are referred to as the Supreme Court). If you are also filing a federal False Claims Act lawsuit, the New York claims can be included in that case, and you do not have to file a separate lawsuit in the N.Y. Supreme Court.

If our case does not involve federal funds, you must file the case in the Supreme Court. Regardless of whether or not the complaint is filed in federal court or state court, the whistleblower is also required to serve the State of New York a copy of the complaint and a disclosure statement.

Read the New York qui tam law for more detailed information.

Key Takeaways

  • New York was the first to allow its False claims Act include state tax fraud whistleblower claims where the defendant has net income or sales exceeding $1 million and damages that exceed $350,000. By contrast, the federal False Claims Act excludes tax fraud and whistleblowers must pursue federal tax fraud claims separately through the IRS whistleblower reward law.
  • There is a 10-year statute of limitations for all New York False Claims Act, compared with the 6-year limitations period under the federal False Claims Act.
  • The New York False Claims Act also has a more relaxed pleading standard for allegations of fraud than under the federal law.
  • Whistleblowers have enhanced confidentiality under the New York False Claims Act when they file their complaints under seal in state court. If the state does not intervene in the whistleblower’s case they can withdraw their qui tam complaint while the case is still under seal and the whistleblower’s identity will remain confidential.

The types of frauds covered under the N.Y. False Claims

Whistleblowers who present original information leading to sanctions against a violator of the New York False Claims Act, may file a qui tam lawsuit to receive protection and a reward. This includes actions against fraudsters who either present false claims to receive state or local government funds, embezzle these funds, or avoid paying the state back altogether. New York is currently the only state in the U.S. that allows whistleblowers to file a whistleblower lawsuit against individuals for violating state tax laws, when the individual’s income is $1 million or more. Types of frauds include:

  • COVID-19 Frauds — fraud in which New York government monies are used;
  • Medicaid Fraud — committed by doctors, hospitals and other types of medical care facilities; Unnecessary medical procedures billed to Medicaid; Illegal marketing of drugs by pharmaceutical companies. The N.Y. False Claims Act would cover the monies spent by state, local or municipal governments. Healthcare fraud cases are almost always filed under both federal and state False Claims Acts, as Medicaid programs are funded by both federal and state monies;
  • Bank & Mortgage Fraud — bankers who commit financial fraud or submit fraudulent claims based on wrongful foreclosures;
  • Tax Frauds — this includes false claims, false statements or the filing of false records under New York Tax laws. The tax provision only covers persons whose income was $1 million or more in the tax year(s) at issue;
  • Underpayments to New York governmental entities — a reverse false claims action can occur when defendants knowingly make a false statement in order to avoid having to pay the government when payment is otherwise due;
  • All claims covered under the federal False Claims Act that concern monies spent (or owed) to the New York (including state, local and municipal governments) or Fraud committed in obtaining contracts from the any New York governmental entity, or the willful failure to perform work under N.Y. government contracts.

Since many whistleblower allegations implicate both federal and state violations and in many cases, the conduct of False Claims Act defendants may also implicate violations of federal securities, commodities or tax laws as well as state laws. It is important to have your case evaluated by whistleblower attorneys who are experienced and have successfully represented whistleblowers under all of these federal whistleblower reward laws as well as the federal and state qui tam laws.

If you’ve been witness to any violation of New York State False Claims Act law, you should consider speaking with a whistleblower attorney who can help explain the law to you to see what kind of federal and state whistleblower rewards you could be eligible for.

Fines for violating the New York False Claims Act

The New York False Claims Act rewards whistleblowers with credible information 3x the damages and penalties between $6,000 – $12,000, not including legal fees. If someone is self-reporting their own fraudulent behavior, they are subject to 2x the damages.

New York False Claims Act Whistleblower Awards

Under N.Y. False Claim Act’s qui tam reward provision, if your original information results in a sanction against a fraudster, you are entitled to a minimum payment of 15% and a maximum payment of 30% of the proceeds awarded by the court and collected by the government. In addition, there are also civil penalties that can be awarded for each false claim or violation.

Whistleblower Protection(s)

The Securities and Exchange Act, the Commodity Exchange Act, the Foreign Corrupt Practices Act, and the Dodd-Frank Act created enhanced provisions to protect the confidentiality of whistleblowers, and also permits Dodd-Frank whistleblowers to anonymously file reward claims. Both federal and New York state whistleblower protection laws allow employees to stop, report, or testify about an employer’s illegal, unhealthy, or unethical actions that violate public policies – without risking retaliation.

Kohn, Kohn & Colapinto cases have set precedents preventing companies from using restrictive confidentiality settlement agreements, severance agreements and nondisclosure agreements (or NDA’s) as a way to prevent an employee from reporting fraud to government regulators. Our whistleblower attorneys have advocated for key reforms protecting employees at publicly traded companies under the Dodd-Frank Act and the Sarbanes-Oxley Act. These advancements in the law have enabled employees to confidentially (or in some cases anonymously) report major fraud and wrongdoing to law enforcement and regulatory authorities, and to Congress, leading to corrective action and large fines as well as whistleblower awards.

Statute of Limitations

A civil action under article §192 of the New York False Claims Act, those filing a complaint of violations to the act must do so within ten years of the date on which the violation occurred. If you’re unsure whether a case is valid or not, you should get in touch with a NY whistleblower lawyer for a free and confidential case evaluation.

Reward for reporting violations of the Securities and Exchange Commission Whistleblower Program

The SEC whistleblower program pays whistleblower awards to whistleblowers who provide the SEC with original information on violations of the Securities Exchange Act if the information leads to a successful enforcement action resulting in monetary sanctions exceeding $1,000,000. The range for awards is between 10 and 30 percent of the money collected.

Reward for reporting fraud under the Commodities Futures Trading Commission

The CFTC whistleblower reward program, established in 2010 under the Dodd-Frank Act, pays whistleblower awards to eligible individuals who voluntarily provide the CFTC with original information on violations of the Commodity Exchange Act that leads to a successful enforcement action resulting in monetary sanctions exceeding $1,000,000. Rewards under the program are mandatory for qualified whistleblowers and are in the range of 10-30% of the collected proceeds. Employers cannot retaliate against whistleblowers or encumber potential whistleblowers from communicating with the CFTC.

Additional Resources