The federal government spends billions of dollars on healthcare every year.  But it also purchases more non-healthcare related goods and services than any other entity, either corporate or governmental.  The federal government’s purchases range from small items like office supplies to billion dollar aircraft carriers.  It pays for services of all kinds too – from maintenance on buildings like courthouses and the Pentagon, to hiring contract security forces to supplement our troops in Iraq, Afghanistan and other far-away places.

The federal government is also reliable about paying its bills.  So between the  sheer volume it buys for a wide variety of goods and services and the massive amount of money it can be counted on to pay under these contracts, the federal government is a tempting target for fraud.  A contractor willing to cut corners in its government contract can improve its own bottom line.  The ways to commit a fraud on the government are as diverse as the goods and services the government contracts for.  Frauds can range from:

• simply overcharging for goods and services to
• engaging in kickbacks and bribery.

There have been some highly creative schemes over the years designed to cheat the government so there’s just no way to create a list that captures all of them.  But, we can still put frauds on the government into a few, big categories.

While healthcare fraud is an obvious priority these days,

• Defense Contracting Fraud and
• Government Procurement Fraud

also cost the federal government billions each year.

Within these two categories there are many different ways that fraud occurs.  That’s why it is so important to have whistleblowers report fraud they have witnessed.

There are powerful laws to help whistleblowers do this, but the process can still be daunting and confusing.  But here’s the thing.  The government has lawyers that represent it.  And you can bet whoever is committing the fraud has lawyers representing them too.  A whistleblower should not be the only one who is not represented in this process. In fact, a whistleblower must be represented by a lawyer to bring a False Claims Act case.   With the right help in place, blowing the whistle on government contracting fraud can save taxpayers billions of dollars, ensure that funds are available for important programs and in the process strengthen our democracy.

For more information download our free eBook Title or fill out the form on this website to report fraud on the government now.

Ten Questions

1. What is defense contracting fraud?

The federal government spends money for the national defense.  Actually, it was expenses related to supplying the Union Army in the Civil War that gave rise to the False Claims Act more than 150 years ago.  Defense contracting fraud refers to fraud that happens in all the contracts related to that national defense.  Of course the federal government is buying a lot fewer muskets and mules than it did in the Civil War.  But it does still buy uniforms, munitions and a wide array of goods and services for defense.  When there’s fraud in the provision of those goods and services,, that would be defense contracting fraud.

2. What is government procurement fraud?

Technically speaking, anytime there’s fraud in providing the government a good or service it’s government procurement fraud because the government is procuring or buying a good or service in every one of its contracts.  But with the volume of healthcare fraud and defense contracting fraud out there, those kinds of fraud have gotten their own names and left Government Procurement Fraud as more of a catch-all reference for all the other frauds on the government.  This could be fraud in providing the government office supplies or computers, for example.  It could involve a fraud in a building project for a road or a bridge.  Fraud happens most commonly in these kinds of contracts where the contractor fails to adhere to the contract specifications, including requirements to provide the government the best available price, to use American-made materials and to pay prevailing wages.  These are just a few examples.  There are a variety of specifications that are provided in every procurement contract.  If the contractor cuts corners and violates these contract parameters, it may lead to False Claims Act liability.

3. What should I do if my employer is falsifying progress reports for a government contract?

Falsifying records that are related to getting paid by the government under a government contract may be evidence of a fraud on the government.  If an employee thinks this is happening at the workplace and it involves a government contract, that person should contact an experienced whistleblower lawyer to help evaluate exactly what is being falsified.  Frauds vary from case to case and contract to contract so there is no single answer for what to do when someone sees this happening.  That’s why it’s so important to have the actual facts of what an employee has witnessed vetted by someone with experience in this area of the law.

4. If a government contractor has a secret deal either with a competitor or a subcontractor to get paid on the side because of a government contract, is that evidence of a fraud on the government?

Any time there is a secret deal between competitors or a prime contractor and a sub-contractor and it involves a government contract, alarm bells should go off.  The government absolutely requires transparency in its contracting.  In most cases it also demands full and open competition and that the government get the best available price.  When there are secret deals, there may be collusion, bid rigging or kickbacks in violation of the False Claims Act.  These secret deals are naturally hard to detect so a potential whistleblower’s information about this kind of misconduct is critical to the government’s ability to stop it.

5. What type of information must a whistleblower provide?

The False Claims Act requires that the whistleblower provide the government with information that is not in the public domain. Or if it is already publicly known, they want the whistleblower to be the source of what is publicly known.  There are volumes written about this question.  But as a rule of thumb, a potential whistleblower should be someone who knows something that no one else does that will help the government prove that there’s been fraud.  If all the whistleblower can tell the government is what he read in the papers or saw in the company’s report to its shareholders,, that’s not going to be enough.

6. I’ve got evidence of one part of my employer’s fraud and I can confirm it with a Freedom of Information Act request. Should I go ahead and submit the FOIA request now to the government so that I can give all this information to my lawyer?

This is such an important question and the answer is NO!  There is a recent Supreme Court case that found a FOIA request may be the basis to prevent a whistleblower from bringing an otherwise perfectly sound case.  No witness is ever going to have absolutely all the evidence to prove up the government’s case so it’s important that the whistleblower contact a whistleblower lawyer with whatever information they have and not take steps like filing a FOIA to gather more evidence. Then they can all go through the whistleblower’s information together and decide what to do with it in a way that best preserves the whistleblower’s rights to bring a case and make a recovery if the case is successful.

7. What role is social media playing in False Claims Act cases?

We live in a wired world and there’s a lot of information out there on social media.  In False Claims Act cases, that can be a good thing, but it can be bad too.  There’s a lot of evidence that can be gleaned through what gets posted on things like Twitter or Facebook, but there is also a real risk that the person who posted it will see who is reading it.  There’s also a lot to be learned from patterns of behavior on social media.  Someone who used to post all the time who suddenly goes silent or someone who rarely looked at other people’s feeds who suddenly starts checking daily may be a red flag.  Social media is filled with great information, but there are real pitfalls, too.

8. Are there statutes of limitations when reporting fraud against the government?

Like any lawsuit, there is a deadline by which you must file your case reporting a fraud on the government.  Without delving into the legal arguments, six years from the event giving rise to the fraud is a good rule of thumb for reporting a fraud against the government. That can go up to as much as ten years in some instances. Also, it’s important to know that the clock resets for every new violation.  So if this is an ongoing fraud, even if the statute has expired as to some of the older violations, the whistleblower may have sound claims for the more recent violations.  Like most things in life, though, it’s best not to push the edges of the deadline and to report the fraud as soon as possible.

9. If I file a FCA whistleblower action, will my employer find out?

The answer to this is yes… eventually.  The False Claims Act requires the case to be filed under seal with the court so the government can investigate what the whistleblower says happened.  During that time, only the whistleblower, the government’s lawyers and investigators and the court where it was filed know that the case exists.  The whistleblower’s employer – the defendant,  will not know of the lawsuit at all during this initial investigation.  However, eventually the case will become unsealed.  Sometimes this happens as a partial unsealing first where the government discloses that there is a case but not who brought it.  But ultimately, the case – except in extremely rare cases – will become unsealed and the whistleblower’s employer will learn that the whistleblower filed the case.  This is one of the reasons it’s so important for a potential whistleblower to contact a whistleblower lawyer early.  Planning for when this disclosure happens is a critical part of the whistleblower’s action plan.

10. My company has an internal compliance program for reporting fraud. Do I still need a whistleblower lawyer?

The whistleblower could definitely benefit from talking to a lawyer – and preferably before going to a company’s internal compliance program to report a fraud.  A company’s compliance program, even if it’s supposed to be anonymous, is really not set up to protect the whistleblower.  It’s there to protect the company against the revelation of what the whistleblower knows.  That is an inherent conflict of interest and it’s an important reason whistleblowers need to know their rights outside of their employer’s compliance program.  A whistleblower lawyer can help explain those rights and help the whistleblower make important decisions on how to report the information that they have.