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What is the Penalty for Violating Federal False Claim Acts?

penalty for violating federal false claim acts

penalty for violating federal false claim actsThe federal False Claim Acts make it a crime to file a false claim for payment from the federal government. One common example is Medicare fraud. This involves billing for treatments or medications that were never provided. The Acts cover claims that are made despite knowing that the claim is false. It also covers claims by someone who is recklessly disregarding information that would lead them to know that the claim is false. To encourage the reporting of false claims, the Acts also provide whistleblowers with compensation and protection from retaliation.

Penalty for Violating Federal False Claim Acts

The federal False Claim Acts provide for both civil and criminal penalties against violators. The criminal penalty for violating federal False Claim Acts can include fines of up to $50,000 and/or imprisonment. Civil penalties of up to three times the amount falsely claimed plus an additional penalty of up to $11,000 per false claim are also possible.

Whistleblower Compensation for Reporting False Claims

If the government learned of the fraudulent activity from a whistleblower, the whistleblower may be entitled to compensation under qui tam laws. The amount of compensation depends on whether the  government recovers the funds, or the whistleblower’s own lawsuit recovers the funds. They range from 15 to 30 percent of the total amount recovered by the government.

To begin a qui tam action, the whistleblower must file a sealed complaint in the appropriate court and serve the complaint on the U.S. Attorney for that district. The government then has 60 days to determine whether it will prosecute the case. If the government declines to prosecute the case, the whistleblower may prosecute it privately.

Whistleblower Protections Under Federal False Claim Acts

Whistleblowers are protected from retaliation for any actions taken under the federal False Claim Acts. This includes both making reports to the government and filing a private lawsuit under the Acts. Employers cannot terminate, harass, or reassign whistleblowers to less desirable positions or schedules. Furthermore, they cannot take any adverse action against an employer because they took action as permitted under the Acts. If you can prove retaliation occurred, the court can force the employer to reinstate the employee. Further, the employer will have to provide them with double their back pay plus interest. Finally, the employer must reimburse their legal costs and any other expenses incurred as a result of the retaliation.

Successfully prosecuting a qui tam action or whistleblower claim requires extensive knowledge of legal procedures and the specific laws governing the false claim. Procedural errors or insufficient evidence can lead to dismissal of the action. This can happen even though they may have been able to succeed on their merits. To speak with an experienced qui tam and whistleblower attorney about how to proceed, call Bothwell Law Group today.

Examples of False Claims Act Violations

Examples of False Claims Act Violations

Examples of False Claims Act ViolationsExamples of False Claims Act violations show the penalties are enormous. But do examples do us any good? It depends on the situation. Many times people learn far better by example than anything else. When you are trying to learn the tango, watching a couple dance with passion teaches more than any book. But when it comes to fraud violations, the examples are frightening.

The False Claims Act exists to punish people who commit fraud against the government. This fraud exists when companies bill the government for services that didn’t take place or overcharge for materials. Billing for services not delivered, overcharging for material goods, failing to provide information related to products or services and charging for skilled professionals who did not perform the work are all examples violations.

Although the law has existed since the Civil War days, Congress made amendments in 1986. The changes allow ordinary citizens to file complaints on behalf of the government. These citizens are the whistleblowers and can receive significant rewards.

Whistleblowers usually work for the company they report for fraud. The False Claims Act protects the whistleblower from retaliation by that company. Whistleblowers that make a complaint of fraud might experience harassment at work. Employers can deny benefits or promotions. Whistleblowers can even lose their jobs. The False Claims Act makes those actions illegal. It also provides a financial reward for whistleblowers.

What Are the Most Common Examples of False Claims Act Violations?

● Most False Claims Act violations are in the healthcare and medical industries. Examples include people who lie to Medicare or Medicaid, facilities that bill for services they did not provide, or those that inflate the cost of the services they did get. They may even lie about who is providing services. The company bills the government for skilled professionals but uses non-professionals instead.

● Drug companies can often be huge offenders of False Claims Act violations. A good example is company salespeople that offer incentives to doctors. Incentives include kickbacks and gifts to the doctors in exchange for using the company’s drugs. Kickbacks can include elaborate vacations and other perks.

● Dental fraud is another example. Dentists claim payments for services they have not completed. For example, a hygienist performs a teeth cleaning, but the bill indicates the dentist did the work and charged his rate.

● More serious examples of healthcare fraud can involve nursing home care or hospice care. The administration may charge for care not given or unnecessary care. The company charges the government for procedures and tests, even though they did not perform the work. Hospice owners may provide care to people who do not need hospice level care.

What Are the Different Types of Violations that the False Claims Act Covers?

Medical and healthcare issues are the most common breaches of the False Claims Act. But there are other violations as well. Here are some examples of False Claim Act Violations:

● Scams that offer free grants for education
● Construction companies working on state highways claim for materials not used
● Business kickbacks or rewards
● Claiming unused materials or labor from defense forces
● Giving untrue information when applying for a government grant or program
● Using lower quality materials than contracted and billed for
● Giving false information to the Department of Veteran Affairs
● Government staff claiming pay for hours that they did not work
● Buying or taking property that belongs to the government

The False Claims Act protects whistleblowers from retaliation by their employers. Examples of retaliation include people losing their jobs because they made complaints, denial of promotions, or not allowing sick days. In addition, whistleblowers might have trouble getting work somewhere else. The company might spread rumors about the whistleblower’s quality of work. They may have them blackballed throughout their industry. All these are violations of the False Claims Act.

What Should You Do If Your Company Is Violating the False Claims Act?

You should consult an attorney experienced in violations of the False Claims Act. They will be able to tell you if your company is breaking the law and committing fraud. They can show you several examples of False Claims Act violations resulting in prosecution. They will also know how to protect you against any retaliation by your employer.

You must report any violations of the False Claims Act that you see. Your attorney will protect you from retaliation. If your allegations result in a conviction, you may receive a huge reward. Contact the skilled False Claims Act attorneys at Bothwell Law Group by calling 770.643.1606 today. We will sit down with you and discuss examples of False Claims Act violations, so you can move forward with confidence.

How to File a Whistleblower Claim under IRS Whistleblower Protection Laws

IRS Whistleblower Protection Laws

IRS Whistleblower Protection LawsAlerting the internal revenue service (IRS) with information that you believe a person or business has violated the tax law is provided for under the IRS Whistleblower Protection Laws. The whistleblower has the potential of receiving a hefty reward if the information provided culminates in the IRS collecting the taxes and finds that the information provided “substantially contributed to the collection of tax.” The award is based on a percentage of the amount collected ranging from 15 to 30 percent.

How to file a claim under IRS whistleblower protection laws

There are certain criteria that the alleged IRS taxpayer violator must meet in order for the IRS to accept the whistleblower claim for investigation:

  • The total amount for collections, including unpaid taxes, interest and penalties must exceed $2 million.
  • Individual taxpayers who are reported must have gross earnings in excess of $200,000 for the taxable year that is under investigation.

If you believe the person or company you are reporting meet these criteria, your report must be filed on a specific IRS form and include:

  • As estimate of the amount of taxes you believe is owed.
  • A summary of all the facts upon which you base your claim.
  • An explanation of how you gained your knowledge of the alleged violation.

Your claim must be filed under penalty of perjury.  If the IRS decides to pursue the claim and determines you played any part in the company decision to underpay taxes, you will not receive any reward and may be criminally prosecuted for those actions.

Although the IRS pledges to protect the identity of the whistleblower as much as possible, you may be called to testify in a judicial hearing if  you are deemed to be “an essential witness.” If the IRS determines in cannot proceed without your testimony, it will notify you and give you the option of remaining anonymous and not pursuing the case, thereby giving up any claim to a reward.

After filing the claim, you  will not be privy to any information concerning IRS actions against the taxpayer or any specific information about the status of the case. You will only be told whether the case is open, denied, closed and payable and the amount of the award that you can expect to receive. It may take years for you to collect your reward since the reward is not paid until the entire amount of the taxes, interest and penalties in question have been collected.

The process is complicated and you need the assistance of attorneys who are dedicated to representing whistleblowers. At the Bothwell Law Group, we have the experience you need for filing your claim under the IRS whistleblower protection laws. We  work diligently to pursue your claim and protect your identity. Contact us today.

Pharmaceutical Whistleblower Case: Whistleblower Gets $33 Million

Pharmaceutical Whistleblower Case

Pharmaceutical Whistleblower CaseA federal judge ruled the whistleblower against Endo Pharmaceuticals is entitled to roughly $33.6 million.

Pharmaceutical company Endo Pharmaceuticals was allegedly promoting the drug Lidoderm for off-label uses and agreed to pay $171.9 million in settlement. $140 million of the settlement goes to the government. 24% of the government’s portion is going to the whistleblower – relator Peggy Ryan. The government, however, argued she should only receive 19% of the federal recovery.

The judge, U.S. District Judge Robert F. Kelly, stated “because of Ryan’s “extraordinary” contributions to the nearly decade-long litigation, she was entitled to more.” He also wrote in his memorandum, “An examination of the record exhibits that Ryan provided not only the spark for the investigation, but that she nurtured the flame at the darkest times when the possibility of a favorable outcome seemed most remote.  Throughout the nine-year period from her first qui tam complain in 2005 to the settlement in 20154, Ryan continually provided access behind the corporate walls of Endo. Ryan’s insider status, conferred by her employment with Endo, enabled the government investigatory team to recover evidence which would have otherwise been unobtainable.”

Ryan’s Role in this Qui Tam case

Whistleblower Peggy Ryan filed a qui tam complaint and an investigation into Endo’s alleged fraudulent practices was launched. Over the next year, Ryan wore a wire and recorded over 200 hours of conversation. Thanks to covertly recording the conversations, evidence was gathered of the unlawful marketing of Lidoderm. Kelly stated the recordings gathered by Ryan provided the evidence of Endo’s strategies to market the drug for off-label uses, promote the drug for off-label uses and management instructing sales representatives on how to convince doctors to promote the drug for said off-label purposes.

Kelly also said Ryan was able to record Lidoderm’s project manager saying 97 to 98 percent of Lidoderm’s prescriptions were off-label.

Judge Kelly made it clear that “It is the view of the court that without the assistance of Ryan, the probability of the government recovering any funds for the [False Claims Act] violations would have been slim at best.”

Ryan and the law firm representing her, James, Hoyer, Newcomer & Smiljanich in Tampa, Florida, produced an 18 minute documentary summarizing the case. This video was then distributed to every federal agent and prosecutor involved.

A word from Ryan’s Lawyer

Christopher Casper of James Hoyer said in a statement to The Legal, “It is never easy to be a whistleblower, especially when a case gone on for a decade, but Ms. Ryan has remained dedicated to the cause of exposing fraud against the government on behalf of the American taxpayer. It has been exactly 10 years and 10 days since this case was filed. We hope Judge Kelly’s decision to grant Ms. Ryan close to the maximum percentage for a relator will encourage other individuals with evidence of fraud against the government to come forward. This case demonstrates that the False Claims Act is the most powerful tool the government has in fighting fraud.”