How to blow the whistle on government fraud in Texas

officeThe False Claims Act (FCA) is a federal law that allows you to blow the whistle on unscrupulous companies, individuals, or contractors who defraud the government by bringing fraudulent claims or contracts. The FCA covers any federally funded contract or program. However, the FCA doesn’t cover securities fraud or tax fraud. Securities fraud is covered by the Dodd-Frank Act and the Foreign Corrupt Practices Act. Tax fraud is covered by the Tax Relief and Health Care Act.

When you have personal knowledge of fraud against the United States or Texas government, whether it’s at your workplace or another workplace, you can bring a Texas qui tam action to court. A qui tam lawsuit is one in which action is taken on the government’s behalf.

There are both federal and state False Claims Acts. Under these laws, you can pursue a qui tam action against an entity that has wronged the government. In a federal case, you file a sealed complaint of fraud based on your private knowledge about the wrongdoing. For example, in one federal case arising in Texas, a relator claimed that the defendants violated the FCA by submitting reimbursement claims of hospice care expenses for patients who weren’t eligible for MHB, when the necessary doctor’s certifications incorrectly certified that they were terminally ill.

The Department of Justice must review the allegations of fraud and investigate. It will determine whether it’s appropriate to intervene. Under the False Claims Act, qui tam cases stay sealed for 60 days to permit the government investigation. The government can extend the seal to permit a longer investigation, and sometimes the investigation lasts at least a year.

If the government does intervene, the civil litigation is handled jointly by the government and your attorney. If there is a financial recovery, you are entitled to receive 15-25% of the funds recovered as a whistleblower or relator in the case.

If the government decides not to intervene, the whistleblower can still go forward with the case to try to prove the government was defrauded. You can still proceed with the case if the government investigates and decides not to intervene. You will need to prove the government was defrauded to make a recovery. When the government decides not to intervene, you can receive 15-30% of the recovery. The chance of recovery is a bit lower if the government doesn’t intervene, and the case may take 3-5 years to resolve.

An individual or company that violates the False Claims Act can be liable for three times the amount by which the government was defrauded. Each false claim can result in penalties of $5,500-$11,000.

You can only file a False Claims Act lawsuit if you are the first to report the fraud. Thus, for example, if the government or your coworker already filed a False Claims Act lawsuit based on the same evidence, you can’t sue yourself.

If we take your case, we will work with a whistleblower to analyze, organize, and collect the evidence of wrongdoing. We will research the fraud and file a sealed False Claims Act claim in federal court. The employer doesn’t get the complaint and isn’t told about what is in it when the case is pending under seal.

You may be concerned that your employer will find out anyhow. The False Claims Act has anti-retaliation provisions that protect you from being discharged, threatened, harassed, demoted, suspended, or otherwise mistreated by your employer if you investigate, report, or try to stop a company from engaging in practices that defraud the U.S. government.

It can be important to obtain representation from an experienced employment lawyer if you intend to file a qui tam action and become a whistleblower in Texas. Contact us at (214) 528-6500 or via our online intake form.

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