Taxpayers Against Fraud (TAF) has released The Importance of Whistleblowers to Reducing Fraud Against the Federal Government and Recovering Funds for Taxpayers. Authored by economist Jack Meyer of Health Management Associates, the TAF report is a response to a paper published by the U.S. Chamber of Commerce and which was authored by a lawyer for corporations that have been prosecuted under the False Claims Act.
In the TAF report, Meyer notes that the False Claims Act has worked well for 25 years, and that policymakers should be cautious about tinkering with whistleblower incentives. “If it ain’t broke, don’t fix it,” cautions Meyer.
Meyer observes that whistleblowers who bring forward the vast majority of cases do so “at no small risk to their own livelihood and wellbeing” and that the Chamber’s analysis is deeply flawed and presents misleading data. For example, notes Meyer, the Chamber report details a whistleblower award associated with a $1 billion dollar case against Pfizer, but leaves out the fact that the case was actually settled for $2.4 billion (an additional $1.4 billion was paid as a criminal penalty), and that of the remaining $1 billion paid, about one third was paid to the states, and so was not subject to a whistleblower award under the federal False Claims Act. In addition, while the Chamber report presents the case as if there was a single whistleblower, there were actually six whistleblowers and seven law firms involved.