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Whistleblower Rewards

An Amendment to the Federal False Claims Act that was passed in 1986 greatly improved the qui tam award to the relator, or whistleblower. Before this amendment, the relators were lucky to get 10 percent of the total award for a successful suit; now that figure may be as high as 30 percent.

Under current law, a qui tam relator files suit against the alleged perpetrator of government fraud. The filing is sealed for sixty days, until the Department of Justice (DOJ) determines whether or not it will take on the lawsuit. If the DOJ decides that it will assume the case, the whistleblower is eligible for 15 to 25 percent of the government's total award for the case; the exact amount depends on the whistleblower's contribution to the success ofthe suit. If the Justice Department declines to take on the suit, the relator is free to pursue it on his or her own. In this case, the relator is eligible for 25 to 30 percent of the total award. Either route can amount to a huge windfall for the relator, barring a third set of circumstances: if the court determines that information revealed by the media or the government was much more critical to the case than that of the relator, the relator may receive an amount less than ten percent and even as little as nothing. It is also important to note that the presiding judge has leeway to adjust any relator award if it is found that the relator participated in the illegal activities.

The total award for a successful false claim suit may be made up of several components. First, the government receives damages - compensation for money of which it was defrauded. Usually, the damages award is double or triple the amount of fraudulent funds taken, depending upon whether or not the defendant is cooperative. In addition to this amount, each violation carries a $5,000 to $10,000 award. Lastly, the total award usually factors in costs of litigation, such as lawyer fees and other expenses.

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