Whistleblower, Qui Tam and GSA Audit Support
Under the False Claims Act, Whistleblowers can be and often times are highly incentivized to report suspected or documented fraudulent activities and these cases will only continue to grow. To address a GSA Schedule contractor’s need for limiting legal and financial exposure, Winvale provides self-audit engagements to help stay ahead of compliance issues before they develop or before a whistleblower takes action.
What you need to know!
The False Claims Act (31 U.S.C. §§ 3729 – 3733) has a whistleblower provision which allows private citizens to file actions against federal contractors and corporations who conduct fraud against the government. Also referred to as “qui tam,” this whistleblower principle is the United States’ most powerful tool for rooting out fraudulent government contracts.
In a qui tam action, the plaintiff (the person bringing the suit) is entitled to a percentage of the recovery of the penalty as a reward for exposing the wrongdoing and recovering funds for the government. The amount of the whistleblower reward depends on many factors, including the quality of the case as presented to the Justice Department. If the government intervenes in the case and recovers funds through a settlement or a trial, the whistleblower, or “relator,” is entitled to 15% and 25% of the recovery. If the government doesn’t intervene in the case and it is pursued by the whistleblower, the whistleblower reward is between 25% and 30% of the recovery. If the government intervenes in the case, they have a 95% success rate in a final settlement or judgment in favor of the federal government. If the government does not intervene, there is only a 9% success rate in a final settlement or judgment in favor of the federal government.
In 2011, Relators (Whistleblowers) were paid $558,000,000 for presenting evidence of fraud and bringing these cases to the federal government. And in 2012, there were 647 new cases and a 62% increase in settlements and judgments from 2011. Many of these cases are GSA Schedule contractors who simply didn’t understand contract compliance.
Need audit support?
We have the expertise to address audit trends in government contracting where high risk exists and focus on key areas that have the most exposure. Further, our self-audit engagements maintain Attorney–client privilege that protects and keeps communications confidential.