The Importance of Whistleblowers
The United States government and the 50 states are the world’s largest purchasers of goods and services — by far— collectively spending billions of dollars every year. And every year significant amounts of that money are lost to fraud, at taxpayer’s expense.
Fraud against government, although as old as government itself, is a serious problem. And the magnitude and persistence of the problem exceed the resources that government prosecutors and investigators could ever conceivably commit to combating it—which is why whistleblowers, whistleblower laws, and whistleblower lawsuits are so important.
Fraud Against the Government
Fraudsters count on the fact that government isn’t always paying attention — and can’t. Whistleblowers change that calculus.
The basic premises behind the whistleblower approach are straightforward. Fraud can be hard to detect. It often succeeds precisely because it is concealed. Government investigators are often poorly positioned to spot it. And they also have limited resources to devote to it. Private citizens, by contrast, are very often eye witnesses to fraud, in a position to know what the government does not, and in exchange for the promise of a share of any recovery can be persuaded to report it. As a result, a public-private partnership, between government investigators and prosecutors on the one hand and private whistleblowers on the other, levels the playing field against fraudsters. Whistleblowers are “force multipliers.” They enable the government to catch and deter much more fraud than it could ever uncover, thwart or punish on its own. Whistleblowers increase enforcement of the law.
The evidence is clear: the whistleblower approach works.
The federal False Claims Act was originally passed in 1863, at President Lincoln’s urging, amidst reports of corrupt profiteers scamming the Union Army. When the War Department paid for sugar, too often it received sand; for muskets or gunpowder, empty crates filled with sawdust; and for sound horses and mules, spavined beasts and dying donkeys.
Congress passed the False Claims Act “to prevent and punish frauds against the Government of the United States.” And from the outset, Congress included provisions in the Act that allowed both government prosecutors and private citizens to bring lawsuits to enforce it.
In the 150-plus years since Congress first adopted this approach to addressing fraud against the government, it has proved so successful that 29 states, the District of Columbia, New York City, Chicago and Philadelphia have all copied it, passing their own false claims laws similarly authorizing private citizen whistleblower lawsuits to recover taxpayer dollars. And the results speak for themselves: in the past five years alone, lawsuits filed by private whistleblowers (known as “qui tam” or “false claims act” suits) have recovered more than 13 billion taxpayer dollars.
Strong democracies and markets benefit from strong whistleblowers—and whistleblowers are rewarded too.
State and federal false claims acts are “bounty” statutes: as an incentive to report fraud and a reward for their efforts, whistleblowers receive a share of the dollars recovered.
In our experience, though, the monetary reward is not what primarily motivates most whistleblowers. Instead, most are following their consciences. Many whistleblowers have complained internally first—and been ignored. And they simply are not willing to participate in a cover-up, condone or perpetuate lies, ignore illegality or dangers to the public, or turn a blind eye to profiteers and fraudsters committing scams at taxpayers’ expense.
To learn more, check out our Qui Tam Law FAQ.
If you have knowledge and solid evidence of fraud or false claims against the government, please contact our Chicago whistleblower attorneys.
Consultations are free and are confidential.