Realizing fraud happens is not enough — you need to take action

This year, International Fraud Awareness Week falls on November 11-17 and is being commemorated by governments and other organizations around the globe. In the United States, people should remember the courageous whistleblowers who have stepped forward under the False Claims Act, IRS, SEC, CFTC and Motor Vehicle Safety whistleblower statutes to ensure business in this country is conducted with integrity. Oftentimes risking their professional reputation or even their personal safety, whistleblowers in the U.S. are integral to preventing fraud against the American taxpayer.  Last year, the federal government recovered over $3 billion in FCA cases alone from entities who defrauded the public.

But even with a whole week dedicated to raising awareness worldwide, fraud fighters in the United States might remain discouraged.  Violations of the False Claims Act remain common across higher education, as well as the pharmaceutical, healthcare and defense industries.  The more astute might also note that official Department of Justice statistics show the number of qui tam actions have skyrocketed in the last ten years: while there were only 4,423 qui tam actions from 1997-2007, there were a whopping 6,164 from 2008 to late September 2017.

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Still, people of integrity should not despair.  The False Claims Act and associated whistleblower statutes under the IRS, SEC, and CFTC are so effective because they allow anybody to step forward and combat fraud.  A larger number of qui tam actions do not necessarily mean that fraud is increasingly rampant throughout the American economy.  Rather, these statistics show more upright people are coming forward to blow the whistle on existing impropriety.

 

Interested in learning how to combat fraud this week?  Remember to keep these things in mind:

Understand the different types of whistleblower actions

Whistleblower programs under the FCA, IRS, SEC, CFTC and Motor Vehicle Safety law all deal with substantially different types of fraud.  For example, actions under the FCA cover fraud against the government by contractors and healthcare providers, but they do not address tax fraud. Instead, members of the public can report tax fraud via the IRS whistleblower program.  Understanding the different federal regulations and whistleblower protections is vital for determining (1) whether fraud is occurring, and (2) what your next steps should be.

For more information, read our overviews of the various different whistleblower programs: More

You need more than just a hunch fraud is occurring

Just feeling that something in your workplace seems “off” is not enough to successfully bring a whistleblower case.  Successful whistleblower actions, particularly those under the FCA, successfully answer the “who, what, when, where, and how” of the alleged fraud scheme.  Develop a general framework of the alleged fraud scheme on paper and then determine what evidence or witnesses can support your claims.

Figure out how the puzzle fits together

Once you have an overall idea of the alleged fraud scheme, take time to sit down and develop a more granular narrative of the alleged fraud scheme.  If possible, include the roles of specific individuals or entities involved in the alleged scheme. Be sure to properly understand which particular laws are being broken and how.  Though you do not need to have complete knowledge of the law you are bringing your whistleblower action under, you should have knowledge of how your particular claims reflect regulatory noncompliance.

Find an attorney who understands current developments in the whistleblower arena

Developments in case law across the various whistleblower laws mean that finding experienced legal counsel is imperative.  Lawyers who do not specialize in qui tam cases or other whistleblower actions may not understand how to properly argue your case, or anticipate the procedural actions that defendants will make to undercut your whistleblower action.  Lawyers in the defense bar make sure to stay abreast of developments in litigation in order to adequately defend their clients by subjecting whistleblowers’ claims to the most rigorous legal benchmarks possible.  In order for your whistleblower action to succeed, you need an advocate who does the same. The members of Taxpayers Against Fraud are the most experienced and knowledgeable whistleblower attorneys in the country, and we recommend you begin your search for an attorney here.

For more information on blowing the whistle, please check out our page here.

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