Frequently Asked Questions

A "qui tam" case is a lawsuit brought by a private person, but on behalf of the government, under the federal False Claims Act or similar state laws. Under the False Claims Act, the private person who brings the lawsuit is known as a "relator." Informally, the term “whistleblower” is often used, although that is a broader term that has meanings outside of the False Claims Act as well. If the government recovers money as a result of the qui tam lawsuit, then the relator is rewarded with a share of the recovered money (between 15% and 30%). The rest goes to the government.

The False Claims Act prohibits the making or presentation of a "false or fraudulent claim" for money to the United States Government. Therefore, in general, the False Claims Act potentially covers all types of false or fraudulent statements made by a company or individual for the purposes of obtaining money from the government. The False Claims Act also has a provision that covers “reverse false claims.”  This provision prohibits the making of false statements for the purpose of avoiding an obligation to pay money to the government.  The False Claims Act has a number of specific exceptions, the most important of which is an exception for tax fraud. However, a separate law covers tax fraud, and also provides for monetary rewards to those who report large tax fraud schemes. To learn more about the law covering tax whistleblowing, click here.

The False Claims Act is specifically designed to encourage whistleblowers to come forward and report fraud, and to pursue qui tam cases on behalf of the government.  A successful qui tam relator is entitled to a minimum of 15% of the total recovery, and can obtain as much as 30% of the recovery in some circumstances. In many cases, relators have received awards of millions of dollars as a result of their right to share in the recovery. These large shares are also designed to create economic incentives for attorneys to agree to represent qui tam relators in False Claims Act cases. In addition to the potential monetary reward, many qui tam relators are whistleblowers who are motivating to expose fraud against the government by patriotism and a strong desire for fairness and justice. These whistleblowers are true heroes, who take on risks and burdens for the good of their country and fellow taxpayers.

Generally, anyone who has non-public information that a company or individual has violated the False Claims Act may blow the whistle by bringing a qui tam lawsuit. Claims have been brought by employees, former employees, customers, competitors, and others who have obtained independent information about fraud against the government.

No. If you learn of fraud against the government from the news media or other public sources of information, you cannot bring a qui tam lawsuit based on that information. You must have independent knowledge of the facts upon which the case is based.

When a qui tam lawsuit is filed by a whistleblower, it is initially kept "under seal." This means that only the government is informed of the lawsuit. During the time that the lawsuit is "under seal," the government has an opportunity to investigate the whistleblower’s allegations. The government, if it chooses, can then "intervene" in the lawsuit. This means that the government's own attorneys, from the Department of Justice, will become involved in litigating the claims. Generally, intervention is a positive development for the whistleblower, because intervention brings all of the resources and prestige of the government to bear on the case. If the government decides not to intervene, however, the relator may still choose to continue the case without the government's assistance.

Yes. A group of whistleblowers may jointly bring a False Claims Act qui tam case. In some cases, this may be beneficial if more than one person has independent knowledge of the fraud.

The False Claims Act has a "first to file" rule. This means that only the first relator (or group of relators acting together) to bring a lawsuit arising out of a particular fraud scheme will be entitled to share in the monetary reward. For this reason, once you decide to move forward with a qui tam case under the False Claims Act, it can be important to prepare and file the lawsuit quickly.

Yes. Subject to some exceptions, a qui tam case under the False Claims Act must be brought within six (6) years of when the fraud occurred. But if you have knowledge of fraud against the government, and are considering a qui tam action, you should not delay. If you wait too long, you may lose your right to obtain a relator's award. If someone else discloses the fraud, or brings another qui tam action, before you do, then you likely will not be eligible for an award.

Not initially. When a qui tam lawsuit is filed in court, it is put "under seal." This means that it is not public, and is not disclosed to the defendants. Instead, only the government learns of the filing. The government will then investigate the claims and decide whether to intervene. If the government intervenes, then the complaint will be served on the defendants and will become public. If the government does not intervene, then the relator can choose to pursue the case without the government's assistance and, at that time, the complaint would be served and would become public. Either way, in most cases, the defendants you are accusing of fraud will eventually learn of your allegations.  The time from the filing of the complaint until the case comes out from “under seal” is typically at least a full year, and often more.

The False Claims Act has a whistleblower protection provision. Under that provision, an employer may not discharge, demote, suspend, threaten, harass or discriminate against an employee for bringing a qui tam case under the False Claims Act. If the employer violates that prohibition, the employee can sue the employer for damages (such as lost wages) and other relief. Thus, the False Claims Act offers protection to an employee who blows the whistle on his or her employer.  Most similar state laws also have anti-retaliation provisions.

For a number of reasons, if you are considering bringing a qui tam lawsuit under the False Claims Act, you should act quickly. If either the government or another qui tam relator discloses the fraud in a lawsuit, you likely will lose your right to a relator's award. Accordingly, at a minimum, you should consult with an attorney to discuss your potential case. An attorney with experience in False Claims Act whistleblower litigation can help you through the process of deciding whether to go forward. Your discussions with the attorney will be confidential. Many attorneys, including the qui tam attorneys at Tycko & Zavareei LLP, will provide you with an initial consultation and advice without requiring you to pay any fees or make any commitments. You should not discuss the matter with anyone other than an attorney. Your discussions with others may not be confidential. Furthermore, you run the risk that someone else will learn of the fraud and will bring a qui tam lawsuit before you do, thereby undermining your right to a relator's award. If you are a current employee of the company or organization that is engaged in fraud on the government, you should not communicate with your attorney (or anyone else) about the fraud through your office computer or telephone. Communications made through an office computer or telephone may not be secure, and may provide a basis for your employer to take actions against you. Instead, use a home computer or personal telephone.

A qui tam lawsuit can take hundreds, or in some cases thousands, of hours of attorney time. If you had to pay the attorneys on an hourly basis, the fees would become prohibitive to most potential qui tam whistleblowers. But many attorneys who handle qui tam cases, such as the qui tam attorneys at Tycko & Zavareei LLP, are willing to do so for a "contingency fee." This means that the attorneys do not charge by the hour for their time. Instead, they agree to accept a percentage of your recovery as their fee, and they take on the risk that, if you do not obtain any recovery, they will not be paid. Different attorneys may be willing to offer different terms. If you are seriously considering a qui tam lawsuit, you may wish to contact a number of different law firms, and find one that you believe will do excellent work and that will offer you favorable contingency-fee terms.

No. Finding an attorney that you believe will effectively and aggressively represent your interests is much more important than finding one that is local. Attorneys who handle False Claims Act qui tam cases routinely work on cases around the country, and not just in the city or state where they have offices. Moreover, for various strategic reasons, the lawsuit might be filed in a city or state other than the one in which you work or live. Where to file the case is an issue that your attorney will analyze.  Accordingly, in searching for representation, you should not necessarily limit yourself to attorneys who happen to have offices close to where you work or live.  The qui tam attorneys at Tycko & Zavareei LLP routinely represent whistleblowers in cases throughout the United States.  For more on how to choose an attorney to represent you in a qui tam case, see our page on Selecting An Attorney.

Under the recently enacted Dodd-Frank Wall Street Reform and Consumer Protection Act, a private person may provide information to the U.S. Securities and Exchange Commission (SEC) regarding violations of federal securities laws.  If the information results in a successful judicial or administrative action by the SEC, then the individual that brought the violations to the SEC’s attention is entitled to a share of the monetary penalties or sanctions recovered by the Government, as long as the Government’s total recovery exceeds $1,000,000.  The whistleblower’s share of the recovery may range from between 10% and 30%.  The Government keeps the rest of the money. The Dodd-Frank Act similarly allows a private individual to provide information to the U.S. Commodities Futures Trading Commission (CFTC) regarding fraud in connection with the sale of commodities.  The whistleblower is likewise entitled to a 10% to 30% share of any monetary penalties or sanctions recovered by the CFTC as a result of the information, provided that the recovery exceeds $1,000,000.

The Foreign Corrupt Practices Act (FCPA) makes it unlawful for a company to bribe foreign officials in order to retain business or direct business to a certain person.  The FCPA also requires companies whose securities are listed in the United States to satisfy certain accounting requirements.  The FCPA is enforced by the Securities and Exchange Commission (SEC) and the Department of Justice. Individuals that provide information regarding violations of the FCPA to the SEC may be entitled to a 10% to 30% share of any monetary penalties or sanctions recovered by the SEC as a result of this information, as long as the SEC’s total recovery exceeds $1,000,000.

Securities fraud whistleblower cases are initiated by filing a Form TCR with the Securities and Exchange Commission’s Office of the Whistleblower.  Commodities fraud whistleblower cases are initiated by filing a Form TCR with the Commodities Futures Trading Commission’s Whistleblower Office.  In either case, the Form TCR should be accompanied by a detailed description of the securities or commodities fraud and include factual evidence and documentation of the alleged misconduct.

Yes.  The Securities and Exchange Commission and the Commodities Futures Trading Commission are required to keep information they receive from a whistleblower confidential.  However, if a public proceeding is initiated based on the information provided by the whistleblower, then the whistleblower’s identity may become public.

No.  But a whistleblower does have the option to file his or her claim anonymously.  In order to file a claim anonymously, the whistleblower must be represented by counsel.

Securities and commodities fraud cases can take hundreds, or in some cases thousands, of hours of attorney time. If you had to pay the attorneys on an hourly basis, the fees would become prohibitive to most potential whistleblowers.  But many attorneys who handle whistleblower cases, such as the attorneys at Tycko & Zavareei LLP, are willing to do so for a "contingency fee."  This means that the attorneys do not charge by the hour for their time.  Instead, they agree to accept a percentage of your recovery as their fee, and they take on the risk that, if you do not obtain any recovery, they will not be paid.  Different attorneys may be willing to offer different terms. If you are seriously considering a securities or commodities fraud case, you may wish to contact a number of different law firms, and find one that you believe will do excellent work and that will offer you favorable contingency-fee terms.

No.  Finding an attorney that you believe will effectively and aggressively represent your interests is much more important than finding one that is local.  Attorneys who handle securities and commodities fraud cases routinely work on cases around the country, and not just in the city or state where they have offices. Moreover, securities and commodities fraud whistleblower cases under the Dodd-Frank Act are filed with the Securities and Exchange Commission and the Commodities Futures Trading Commission in Washington, D.C.  It may be beneficial to retain attorneys, such as the attorneys at Tycko & Zavareei LLP, that have offices in Washington, D.C.  Accordingly, in searching for representation, you should not necessarily limit yourself to attorneys who happen to have offices close to where you work or live.  The attorneys at Tycko & Zavareei LLP routinely represent whistleblowers in cases throughout the United States.  For more on how to choose an attorney to represent you in a securities or commodities fraud case, see our page on Selecting An Attorney.

The federal tax whistleblower law covers both intentional and unintentional underpayment of taxes.  Accordingly, if you have information that a company of individual has either committed tax fraud, or has simply failed to pay the legally-owed amount of taxes, you may be able to bring a claim for a reward.

If you have information concerning underpayment of federal taxes, the claim must be filed with the IRS Whistleblower Office, pursuant to procedures established by that office.  At a minimum, you must file an IRS Form 211, Application for Award of Original Information.  To make your claim stronger, however, you may wish to consult with an attorney, and have the attorney prepare a more extensive filing that includes your evidence, and an explanation of the tax issues.

When you file a claim for a reward with the IRS Whistleblower Office, the IRS will keep your identity confidential to the fullest extent allowable under the law.  In most cases, this means that your identity will not be made public, or provided to the target of the investigation.  In rare cases, your claim could result in a civil or criminal lawsuit.  If that happens, the IRS does have the right to call you to testify as a witness, at which point your identity would become known to the defendant.  So, although the great majority of IRS whistleblowers will remain anonymous, that anonymity is not 100% guaranteed.

Under the federal tax whistleblower law, if the amount of taxes, penalties and interests owed by the taxpayer exceeds $2 million (and a few other conditions are met), you would be legally entitled to an award of at least 15%, up to a maximum of 30%.  If the amount at issue was $2 million or less, then the maximum award would be 15%, and would be discretionary with the IRS.

Tax whistleblower cases can take many attorney hours to prepare and pursue. If you had to pay the attorneys on an hourly basis, the fees would become prohibitive to most potential whistleblowers.  But many attorneys who handle whistleblower cases, such as the attorneys at Tycko & Zavareei LLP, are willing to do so for a "contingency fee."  This means that the attorneys do not charge by the hour for their time.  Instead, they agree to accept a percentage of your recovery as their fee, and they take on the risk that, if you do not obtain any recovery, they will not be paid.  Different attorneys may be willing to offer different terms. If you are seriously considering a tax whistleblower case, you may wish to contact a number of different law firms, and find one that you believe will do excellent work and that will offer you favorable contingency-fee terms.

No.  Finding an attorney that you believe will effectively and aggressively represent your interests is much more important than finding one that is local.  Attorneys who handle tax whistleblower cases routinely work on cases around the country, and not just in the city or state where they have offices.   And all tax whistleblower cases are filed with the IRS Whistleblower Office,, located in Washington, D.C.

The IRS whistleblower process is quite slow.  The IRS does not pay an award until it has investigated the claim, assessed the taxes owed by the taxpayer, and then actually collected money from the taxpayer.  This process can take several years.

The federal False Claims Act contains a specific exclusion for taxes owed to the federal government.  Accordingly, the only way to obtain a reward for blowing the whistle on federal tax fraud is to file a claim with the IRS Whistleblower Office.  However, some states—most notably New York—do permit private parties to bring lawsuits under state law to recover state taxes.  Accordingly, if you have information that a company or individual owes taxes to the State of New York, you may wish to consider bringing a lawsuit under the New York False Claims Act.

Two statutes establish the framework for bank fraud whistleblower cases:  the Financial Institutions Anti-Fraud Enforcement Act of 1990 (FIAFEA) and the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA).  FIRREA, which was enacted in the wake of the savings and loan crisis of the 1980s, gives the U.S. Attorney General the power to bring civil actions seeking statutory penalties for violations of various criminal laws that apply to the banking industry, including bank fraud, wire fraud, and mail fraud.  “Bank fraud,” as well as mail and wire fraud, are broadly defined such that almost any fraud on a bank by its customers, or by a bank’s own employees, officers or directors, may come within the scope of the FIRREA civil penalties provision. FIAFEA was enacted a year after FIRREA and its goal was to encourage whistleblowers with information about fraud on or by banks to come forward with that information, so that the Attorney General could use that information to ferret out FIRREA violations.  In exchange for providing the Attorney General with information of a FIRREA violation, the whistleblower was entitled to a monetary reward.

Yes.  Under the Financial Institutions Anti-Fraud Enforcement Act of 1990 (FIAFEA), the whistleblower is entitled to 20% to 30% of any recovery up to the first $1,000,000 recovered by the Government, 10% to 20% of the next $4,000,000 recovered, and 5% to 10% of the next $5,000,000 recovered.  So, if the government recovers $10 million or more, then the whistleblower reward would range from a low of $850,000 to a high of $1.6 million.

In order to commence a bank fraud whistleblower case under the Financial Institutions Anti-Fraud Enforcement Act of 1990 (FIAFEA), the whistleblower must file a “declaration” with the U.S. Attorney General’s Office.  The declaration is a sworn statement that sets forth all the whistleblower’s knowledge regarding the alleged bank fraud.  The declaration should also be accompanied by any documentary evidence that supports the whistleblower’s allegations

The Financial Institutions Anti-Fraud Enforcement Act of 1990 (FIAFEA) and the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) empower the U.S. Attorney General to bring a civil action for fraud upon any federally insured financial institution.  Accordingly, FIAFEA and FIRREA not only cover fraud upon banks, but any financial institution that receives financial guarantees from the federal government.

No.  Under the Financial Institutions Anti-Fraud Enforcement Act of 1990 (FIAFEA) any person may file a declaration with the U.S. Attorney General’s Office exposing fraud on a bank or other federally insured financial institution.  However, FIAFEA contains a unique provision that may benefit a whistleblower that has retained counsel.  Under FIAFEA, within one year of the date of filing, the Department of Justice must provide the whistleblower written notice of the status of its investigation into the whistleblower’s allegations.  One option available to the DOJ is to state in the notice that “the allegations have yet not been addressed.”  If DOJ chooses that option, then the whistleblower can request that the DOJ award a contract to the whistleblower’s own attorney to pursue the case.  The DOJ must then either award such a contract, or bring a claim on its own based upon the whistleblower’s allegations.  If the DOJ chooses to award a contract to the whistleblower’s attorney, then FIAFEA provides that it should be a contingency fee contract.  Thus, it may behoove a whistleblower to hire an attorney to pursue his or her case in the event the DOJ decides not to file a claim because the whistleblower’s attorneys may be afforded the right to pursue the case on the DOJ’s behalf.

Bank fraud cases can take hundreds, or in some cases thousands, of hours of attorney time. If you had to pay the attorneys on an hourly basis, the fees would become prohibitive to most potential whistleblowers.  But many attorneys who handle whistleblower cases, such as the attorneys at Tycko & Zavareei LLP, are willing to do so for a "contingency fee."  This means that the attorneys do not charge by the hour for their time.  Instead, they agree to accept a percentage of your recovery as their fee, and they take on the risk that, if you do not obtain any recovery, they will not be paid.  Different attorneys may be willing to offer different terms. If you are seriously considering a bank fraud case, you may wish to contact a number of different law firms, and find one that you believe will do excellent work and that will offer you favorable contingency-fee terms.

No.  Finding an attorney that you believe will effectively and aggressively represent your interests is much more important than finding one that is local.  Attorneys who handle bank fraud cases routinely work on cases around the country, and not just in the city or state where they have offices. Moreover, bank fraud cases filed under the Financial Institutions Anti-Fraud Enforcement Act of 1990  are filed with the U.S. Attorney General’s Office in Washington, D.C.  It may be beneficial to retain attorneys, such as the attorneys at Tycko & Zavareei LLP, that have offices in Washington, D.C.  Accordingly, in searching for representation, you should not necessarily limit yourself to attorneys who happen to have offices close to where you work or live.  The attorneys at Tycko & Zavareei LLP routinely represent whistleblowers in cases throughout the United States.  For more on how to choose an attorney to represent you in a securities or commodities fraud case, see our page on Selecting An Attorney.