The Federal False Claims Act: A Whistleblower’s Guide to Exposing Fraud Against the Government

If you’ve uncovered fraud being committed against the U.S. government—whether by a healthcare provider, defense contractor, university, or another organization—you may be wondering what to do next. The answer may lie in one of the most powerful legal tools available to ordinary citizens: the Federal False Claims Act (FCA).

 

The False Claims Act allows private individuals—known as relators or whistleblowers —to file lawsuits on behalf of the federal government against entities that are defrauding taxpayer dollars. In return for their courage and cooperation, successful whistleblowers may be entitled to a significant share of the government’s recovery—often 15% to 30% of the total amount.

 

This guide is written for you—the potential whistleblower. We’ll walk you through how the False Claims Act works, what your rights and responsibilities are as a relator, and what the process of filing and pursuing a qui tam lawsuit looks like from start to finish.

 

---

What Is the False Claims Act?

 

The False Claims Act, codified at 31 U.S.C. §§ 3729–3733, is a federal law that imposes liability on individuals and companies that knowingly submit false claims for payment to the U.S. government. It was originally enacted in 1863 during the Civil War to combat fraud by defense contractors. Over the years, it has evolved into a powerful tool for uncovering all types of government fraud—including fraud in healthcare, military contracting, education, construction, and disaster relief.

 

What makes the FCA unique is its qui tam provision. Qui tam is a Latin phrase meaning “he who sues in this matter for the king as well as for himself.” Under this provision, private citizens with knowledge of fraud can bring lawsuits on behalf of the government. If the case is successful, the whistleblower (relator) may receive a portion of the money recovered.

 

---

Who Can Be a Whistleblower?

 

Almost anyone with non-public, first-hand knowledge of fraud against the government can become a whistleblower under the FCA. This includes:

 

• Employees(past or present) of the offending company
• Independent contractors
• Competitors who uncover fraud through legitimate means
• Government employees, in some cases
• Even patients or customers, depending on the circumstances

 

However, the relator must bring original information —not information that is already public unless they are the original source. This means reading a news article about fraud generally won’t qualify someone to file a qui tam suit unless they were the person who provided that news outlet with the facts in the first place.

 

---

What Kinds of Fraud Does the FCA Cover?

 

The False Claims Act covers a wide variety of fraudulent schemes, including but not limited to:

 

1. Healthcare Fraud

• Billing Medicare or Medicaid for services not rendered
• Upcoding (charging for more expensive procedures than were performed)
• Unnecessary medical treatments
• Kickbacks or illegal referrals

2. Defense and Government Contracting Fraud

• Overcharging for goods or services
• Providing substandard or noncompliant products to the military
• Double billing or misrepresenting costs

3. COVID-19 Relief Fraud

• Misuse of Paycheck Protection Program (PPP) loans or Economic Injury Disaster Loans (EIDL)
• Falsifying applications to obtain pandemic aid

4. Education and Research Fraud

• False certifications of compliance with grant requirements
• Misuse of federal research funds or Title IV education funding

5. Procurement and Construction Fraud

• Fraudulent small business certifications
• Bid rigging or collusive bidding
• False reports of project completion

---

How the Process Works: Step by Step for the Whistleblower

 

Filing a False Claims Act case is not like filing an ordinary lawsuit. It follows a very specific procedure, and strict rules apply. Here’s what to expect if you’re considering blowing the whistle.

 

1. Hire Experienced Legal Counsel

 

Your first and most important step is to speak with an attorney who has experience handling FCA qui tam actions. The False Claims Act is legally and procedurally complex. Your attorney will evaluate the merits of your case, help gather evidence, and prepare a sealed complaint for filing in federal court.

 

Importantly, whistleblowers cannot represent themselves in qui tam actions. Federal courts require that a relator be represented by counsel.

 

2. File the Complaint Under Seal

 

Once the complaint is prepared, your attorney will file it under seal in a U.S. District Court. This means that the case is kept confidential —the defendant will not be notified, and the case will not be made public.

 

Along with the complaint, your attorney must also serve a disclosure statement to the U.S. Department of Justice (DOJ), containing all relevant evidence in your possession.

 

The seal period lasts a minimum of 60 days, but in most cases it is extended—sometimes for a year or more—as the government investigates.

 

3. Government Investigation and Decision to Intervene

 

During the sealed period, the Department of Justice—often in conjunction with other agencies like the FBI, HHS, or DOD—will investigate the allegations. They may interview witnesses, subpoena documents, or meet with you and your attorneys.

At the end of the investigation, the DOJ will decide whether to:

 

• Intervene in the case and take over litigation, or
• Decline to intervene, allowing the relator’s counsel to proceed independently

 

Cases where the government intervenes are more likely to result in a recovery, but many successful cases have gone forward without government intervention.

 

---

Potential Outcomes and Rewards for Whistleblowers

 

If the case results in a recovery—through settlement or court judgment—the whistleblower is eligible to receive a reward:

 

• 15% to 25% of the recovery if the government intervenes
• 25% to 30% if the government declines and the relator prosecutes the case successfully

 

Given that FCA cases often result in multi-million-dollar settlements, whistleblower awards can be substantial. For example:

 

• A healthcare administrator who blew the whistle on a hospital chain’s billing fraud received over $17 million
• A defense contractor employee who exposed cost-padding on military contracts received $3.9 million

 

The relator is also entitled to recover reasonable attorneys’ fees and costs, which are paid by the defendant if the case is successful.

 

---

Protection Against Retaliation

 

Many potential whistleblowers fear retaliation—being demoted, fired, or harassed for speaking up. Fortunately, the FCA has a strong anti-retaliation provision. Under 31 U.S.C. § 3730(h), if you are retaliated against for investigating or filing a False Claims Act suit, you may sue your employer for:

 

• Reinstatement to your former job
• Double back pay
• Special damages, including emotional distress
• Attorneys’ fees and litigation costs

 

To qualify for protection, you must have engaged in efforts to stop fraud against the government and the employer must know about those efforts.

 

---

Key Considerations Before Filing

 

Before moving forward, potential relators should carefully consider the following:

 

1. Is Your Information Solid?

 

The government and courts are more likely to take your claim seriously if you have concrete evidence —documents, emails, billing records, etc.—rather than just suspicions.

 

2. Is There a Prior Filing?

 

Under the first-to-file bar, only the first relator to file a claim about a particular fraud scheme can recover. If someone has already filed a similar suit, you may be barred from bringing your own.

 

3. Is It Public Knowledge?

 

The public disclosure bar prevents cases based solely on information that’s already publicly available (e.g., from news articles, lawsuits, or audits), unless the relator is the original source of that information.

 

---

How a Whistleblower Attorney Can Help

 

The role of an experienced attorney in a False Claims Act case cannot be overstated. From your perspective as a whistleblower, your legal team will:

 

• Assess the strength of your claim
• Gather and organize evidence
• Draft and file the sealed complaint
• Handle all communications with the Department of Justice
• Litigate the case if necessary
• Protect you from retaliation or legal exposure
• Fight to maximize your relator’s share

 

At Ryan & Rouse, we have experience guiding courageous individuals through the whistleblower process. We understand the risk you’re taking—and the impact your actions can have on ending fraud and abuse.

 

---

Conclusion: Do You Have a False Claims Act Case?

 

If you suspect that fraud is being committed against the federal government and you have first-hand knowledge, you may be eligible to file a whistleblower claim under the Federal False Claims Act. This law empowers individuals like you to help stop fraud, protect public funds, and receive substantial compensation in the process.

 

At Ryan & Rouse, we can help you evaluate your claim in confidence. Your identity will be protected throughout the early stages of the case, and our team will stand beside you every step of the way.

 

You don't have to blow the whistle alone. Let us help you do it the right way.

 

---

Contact Us Today for a Confidential Consultation

 

If you think you may have a potential whistleblower case under the False Claims Act, contact Ryan & Rouse for a free, confidential consultation. We’re here to listen, advise, and fight for justice on your behalf.