Can I qualify for a whistleblower reward?
Yes, but it depends on what you blow the whistle on and who and how you communicate your disclosures. The following tools will help you find out if you can qualify for a whistleblower reward.
What disclosures qualify for a whistleblower reward?
Under specific U.S. laws, both citizens and foreign nationals can qualify for financial rewards as whistleblowers if they disclose violations that result in the U.S. obtaining sanctions from the wrongdoer.
The significant financial reward laws are:
- False Claims Act
- Tax Fraud & underpayments of tax. The IRS may also pay rewards for information regarding a matter that is the subject of an IRS criminal investigation, or on reports of false information provided on forms required by the IRS. (Tax-related or not).
- Securities Exchange Act
- Commodities Exchange Act
- Foreign Corrupt Practices Act
Other laws also provide financial rewards but historically have not been as effective as the ones listed above. They are:
How do you file for a whistleblower reward?
To qualify for a financial reward, you must follow strict procedures set forth under each act. The failure to follow these procedures can result in denial of an award even if your information results in a substantial sanction obtained by the government. The New Whistleblower’s Handbook outlines the process for each of the significant reward laws.
Can I remain confidential and anonymous when I apply for whistleblower reward?
The Securities Exchange Act, the Commodities Exchange Act, and the Auto Safety Act each explicitly provide for anonymous filings. Under each of these laws, you must be represented by a licensed attorney to file your claim anonymously. To remain anonymously, the attorney applies on your behalf.
Under IRS whistleblower law, you can’t file anonymously, but the IRS has stringent rules protecting the confidentiality of whistleblowers. In practice, the IRS rules have proven to be as effective as the anonymity rules. However, to file an IRS claim, you must personally sign the form under oath.
The False Claims Act permits whistleblowers to file a lawsuit under seal. The whistleblower’s identity is only known to the court and the U.S. government while the case is under seal. By court order, the whistleblower complaints and the whistleblower’s identity must remain confidential until the U.S. district court orders otherwise. Furthermore, initially, the complaint is not served on the defendant.
These provisions permit the government to initiate a confidential investigation. Once the government concludes its investigation or once the court lifts the seal, the whistleblower’s complaint typically become a matter of public record. In most cases, the defendants eventually learn the whistleblower’s identity. There are no firm rules governing confidentiality under the APPS, the Lacey Act, or the Endangered Species Act. Whistleblowers who utilize these laws should request confidential informant status.
Do you get paid for whistleblowing?
The whistleblower reward laws have been remarkably successful, and they are now the best laws protecting and compensating whistleblowers.
From 1986 to 2019, the False Claims Act paid whistleblowers $7 billion in rewards. In 2018, the IRS paid over $312 million in rewards to whistleblowers. The Securities Exchange Commission (SEC), since the inception of their program, has paid whistleblowers over $450 million. And from 2014 to 2018, the CFTC whistleblower program collected over $87 million from wrongdoers.
The False Claims Act, IRS Whistleblower Program, Commodity Exchange Act, Securities Exchange Act, Auto Safety Act, and the Foreign Corrupt Practices Act all require the government to pay a minimum reward to the whistleblower of between 10% – 15%. Under some of these laws, the reward can be as much as 30% of the collected proceeds. The failure of the U.S. government to honor these rewards is subject to judicial review.
What are the limits of this FAQ? Is there a disclaimer concerning the information presented here?
Whistleblower laws are complex. There are several qui tam or reward laws that can result in a whistleblower obtaining a multi-million-dollar judgment. Each of these laws has specific filing requirements. Additionally, there are over 50 different federal anti-retaliation laws designed to protect whistleblowers from discrimination. Again, each of these laws has various lengths of statutes of limitation, filing procedures, and definition of a protected disclosure.
These FAQs give whistleblowers an overview of significant whistleblower qui tam, reward, or anti-retaliation laws. They are not comprehensive. If you believe you may have a whistleblower case, you should contact an attorney and obtain specific advice based on the facts of your case. You cannot rely only on the information in this FAQ to determine whether or not you have a valid claim.
A critical resource for those thinking of blowing the whistle is The New Whistleblower’s Handbook: A Step-by-Step Guide to Doing What’s Right and Protecting Yourself (Lyons Press 2017). The Handbook contains a detailed discussion on all major whistleblower laws and has extensive citations to legal cases and statutes the protect whistleblowers. It is an invaluable resource.
Because of the complexity of the whistleblower laws, we disclaim all liability in respect to actions taken or not taken based on the contents of this FAQ. The FAQ is a summary guide to understanding your rights. You should contact an attorney with expertise in whistleblowing before you make a disclosure. You must know your rights before you “blow the whistle,” so you can ensure that your conduct will be protected.
Can the whistleblower attorneys working at Kohn, Kohn and Colapinto help me?
The whistleblower law firm of Kohn, Kohn and Colapinto has a straightforward intake process. It is available here. Every intake is confidential, and the information provided protected under the attorney-client privilege. A senior partner at Kohn, Kohn and Colapinto reads each intake submission.
The intake process is free of charge.
Unfortunately, KKC receives many more requests for assistance then it can handle and must turn away many qualified whistleblowers. If KKC cannot represent you, you still may have a solid case.
If KKC believes you may have a case with which it can help you, you will receive a follow-up call or email to obtain more information and determine whether or not our firm can represent you. Until you have a signed written agreement with the firm, we are not your attorneys (although all of the information you provide to us is privileged and confidential). Almost all of our cases are on a contingency fee basis.