To motivate people to report corporate crime, the U.S. Department of Justice (DOJ) Aug. 1 announced a whistleblower rewards program.[1] DOJ is dangling dollars for original information on four types of criminal fraud, including fraud against private insurers.
Whistleblowers could be rewarded for nonpublic information they give to DOJ—including information they initially reported through an organization’s “internal whistleblower, legal or compliance procedures”—as long as they do it within 120 days of reporting internally, and it results in a successful prosecution and $1 million in forfeiture.
“This is a game changer for enforcement and corporate accountability,” said attorney Mary Inman with Whistleblower Partners LLP. She said the Corporate Whistleblower Awards Pilot Program fills a gap left by the qui tam provisions of the False Claims Act (FCA), which only incentivize whistleblowers to report fraud against federal health care programs.
It follows on the heels of highly successful whistleblower rewards programs at five other federal agencies, including the Securities and Exchange Commission and Internal Revenue Service, Inman said. “They’re playing a game of catch up,” she said. “We’re delighted they’re doing that.” In cases where a health care organization, for example, is improperly billing both Medicare and private insurers, whistleblowers would be able to simultaneously file an FCA lawsuit and report the wrongdoing to the awards program. A version of that dynamic already exists under state laws in California and Illinois, which allow whistleblowers to bring civil lawsuits against entities for defrauding private insurers and collect a share of recoveries, Inman said. “All of the whistleblower attorneys who bring Medicare fraud claims will now bring a separate tip to DOJ when the types of health care fraud our clients are seeing negatively impact private insurers,” she said.