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Fighting to Hold Fraudsters Against the Government Accountable
It often starts with a gut feeling. An invoice that doesn’t look right. A conversation you overhear. A pattern of behavior that just seems off. You work hard, you believe in doing the right thing, and you see something that makes you question if your employer or a company you work with is playing by the rules — especially when taxpayer money is involved.
When people deliberately defraud the government, they often go to great lengths to hide their actions. But they can’t hide everything. Observant and principled employees, contractors, or even competitors can often spot the irregularities that others miss.
If you find yourself in this situation, you may feel uncertain, isolated, and concerned about what to do next.
How do you know if you have a whistleblower case? The answer to this critical question comes from applying the law designed to empower people in these situations: the False Claims Act. A whistleblower lawyer can explain how it applies in your situation.
Key Takeaways
- The federal False Claims Act (FCA) is the primary law used to combat fraud against the U.S. government.
- The FCA’s qui tam provision allows private citizens, known as relators, to file lawsuits on behalf of the government and potentially receive a reward.
- Reckless disregard for the truth, not just actual knowledge of fraud, can establish liability under the FCA.
- Common areas for FCA cases include healthcare fraud (such as in Medicare/Medicaid scams) and defense contractor fraud.
- The law includes anti-retaliation provisions to help protect whistleblowers from actions like termination or demotion by their employers.
- A “first-to-file” rule means that generally only the first person to report a specific fraud qualifies to proceed with the case.
The legal foundation for whistleblowers: The False Claims Act
The primary legal tool for combating fraud against the federal government is the False Claims Act (FCA). Originally passed during the Civil War to fight fraud by suppliers to the Union Army, the law is sometimes called the Lincoln Law. Its core purpose is to hold individuals and companies accountable for knowingly submitting or causing the submission of false or fraudulent claims for payment to the government.
A powerful component of the FCA is its qui tam provision. The term qui tam is short for a Latin phrase meaning “he who sues on behalf of the king as well as for himself.” This provision allows private citizens with knowledge of fraud to file a lawsuit on behalf of the United States government. In this context, the private citizen is called the “relator.”
If the lawsuit succeeds and the government recovers funds, the relator may recover a portion of that recovery as a reward. This system recognizes the immense courage and personal risk it takes to come forward and provides a powerful incentive for people to expose wrongdoing that might otherwise go undetected.
What Does “Knowingly” Mean Under the FCA?
One of the most important aspects of the False Claims Act is its definition of “knowingly.” You do not need a smoking gun email where a CEO explicitly states, “Let’s defraud the government.”
The FCA establishes a broader standard that includes:
- Actual Knowledge: The person or company knew the information was false.
- Deliberate Ignorance: The person or company intentionally avoided learning the truth.
- Reckless Disregard: The person or company was careless or negligent in determining if the information was true or false.
This means that a company can’t simply turn a blind eye to obvious fraudulent billing practices and later claim they didn’t know. If they should have known, a whistleblower lawsuit can hold them liable.
Spotting the red flags: Common examples of government fraud
Fraud against the government can occur in any industry that receives federal funding. Despite their complexity, schemes often fall into several common categories. Below are some of the most prevalent types of fraud that can form the basis of a successful whistleblower case.
Healthcare fraud (Medicare & Medicaid)
The healthcare industry is, by far, the largest source of False Claims Act cases. Medicare and Medicaid are vast, multi-billion-dollar programs, making them prime targets for fraud. If you work in healthcare — as a doctor, nurse, hospital administrator, medical biller, or even for a pharmaceutical company — you may witness this fraud firsthand.
Common schemes include:
- Billing for Services Not Rendered: This is a classic form of fraud. It can involve a medical practice billing Medicare for patient visits that never happened, charging for lab tests that were never performed, or billing for equipment that was never delivered.
- Upcoding: This happens when a provider bills for a more expensive service or procedure than the one it actually performed. For example, a doctor performs a brief, routine office visit but bills it under the code for a comprehensive, complex evaluation.
- Unbundling: Some medical procedures are meant to be billed as a single, bundled package. Unbundling occurs when a provider bills for each step of the procedure separately to improperly increase their reimbursement from the government.
- Anti-Kickback Statute Violations: It is illegal to offer, pay, solicit, or receive anything of value to induce or reward referrals for items or services paid for by federal healthcare programs. This can include a lab paying a doctor’s office a “fee” for every patient they refer for testing or a hospital providing a physician with free office space in exchange for patient referrals.
- Pharmaceutical and Medical Device Fraud: This can take many forms, including a drug company promoting a drug for off-label uses not approved by the FDA (leading to fraudulent reimbursement claims), providing kickbacks to doctors to prescribe their products, or failing to follow proper manufacturing practices, resulting in the sale of defective products to the government.
- Nursing Home Fraud: This often involves a facility billing Medicare or Medicaid for services that were not provided or for a level of care that residents did not receive, resulting in both financial fraud and egregious patient neglect.
Defense contractor fraud
The U.S. Department of Defense spends hundreds of billions of dollars on contracts for weapons, equipment, and services. This massive scale of spending creates opportunities for fraud.
Common military and defense contractor fraud schemes include:
- Overcharging for Goods or Services: Billing the government for inflated labor hours, materials, or other costs that the contractor never actually incurred.
- Providing Substandard Products: Knowingly supplying parts or materials that do not meet contract specifications. This can include using lower-grade metals, providing faulty electronics, or falsifying test results to make it appear that products meet quality standards. This type of fraud is particularly dangerous as it can put the lives of service members at risk.
- Cross-Charging: Improperly shifting costs from a private-sector, fixed-price contract to a government, cost-plus contract to fraudulently increase profits.
- Violating the Truth in Negotiations Act (TINA): TINA requires contractors to submit accurate, complete, and current cost and pricing data before the award of certain contracts. Hiding information or providing false data to inflate the contract price can violate the FCA.
Other common government fraud schemes
While healthcare and defense are the two largest areas, fraud can occur with nearly any type of government contract or program.
- Construction and Public Works Fraud: Contractors on federally funded projects (like highways, bridges, or federal buildings) may use substandard materials, bill for work that was never done, or falsify reports about project milestones.
- Education and Grant Fraud: A university or research institution may misuse federal grant money, falsify research data to secure new grants, or lie about its eligibility for federal education funding.
- Disaster Relief Fraud: Following a hurricane, flood, or other natural disaster, contractors may submit fraudulent claims to the Federal Emergency Management Agency (FEMA) for cleanup or repair work that was not performed or was done improperly.
- Paycheck Protection Program (PPP) Fraud: Companies that made false statements on their applications to obtain PPP loans they were not entitled to — or used the funds for unapproved purposes — may have violated the False Claims Act.
Your role as a potential whistleblower
If you have observed any of the activities described above, you may wonder what to do. The law provides a path forward, but it has specific, important rules, such as:
Who can be a whistleblower?
Anyone with original, non-public information about fraud against the government can be a relator. This includes:
- Current and former employees
- Contractors and subcontractors
- Competitors
- Healthcare professionals
- Billing and coding specialists
- Project managers
You don’t have to be a high-level executive to have a valid case. Often, it’s the people on the front lines who see the fraud most clearly.
The importance of evidence and confidentiality
A strong whistleblower case requires solid evidence. This can include emails, internal memos, billing records, test results, or detailed witness testimony. However, do not take illegal actions to gather this evidence. An experienced whistleblower attorney can advise you on how to proceed lawfully and help protect your rights.
The “first-to-file” rule
The False Claims Act includes a “first-to-file” rule. This means that only the first relator to file a lawsuit based on a particular set of fraudulent activities can proceed with the case and receive a reward. If someone else files before you do, you may not bring your own case. This rule makes it essential to act promptly — but carefully — once you suspect fraud.
Protections and rewards: How the system is built for you
The government understands that blowing the whistle on an employer or a powerful company is an act of courage that comes with significant risk. People are often afraid of losing their jobs, facing professional retaliation, or being ostracized.
Fortunately, the False Claims Act was designed with these fears in mind.
Anti-Retaliation protections
The FCA contains a strong anti-retaliation provision. It is illegal for an employer to fire, demote, harass, threaten, or otherwise discriminate against an employee for taking lawful actions in furtherance of an FCA case. If an employer violates this provision, the whistleblower may be able to seek remedies including:
- Reinstatement to their job
- Double the amount of back pay owed
- Compensation for any special damages sustained as a result of the retaliation
Whistleblower rewards
As mentioned, the government may reward whistleblowers for their role in stopping fraud. If the case succeeds, the relator may receive between 15% and 30% of the total amount recovered by the government. These rewards can reach millions of dollars.
More importantly, they represent the country’s gratitude to individuals who put themselves on the line to protect American taxpayers and ensure that government funds are used for their intended purpose.
How an experienced whistleblower team can guide you
The process of handling a potential False Claims Act case is legally intricate, the stakes are high, and the defendants are often powerful corporations with deep legal resources. You want an advocate who understands the law and has the experience and resources to stand with you every step of the way.
At Carolina Whistleblower Attorneys, we are dedicated to guiding and protecting courageous individuals who come forward to fight fraud.
Our team is led by a former U.S. Attorney, Bill Nettles, who once prosecuted these very types of cases on behalf of the government and helped lead the nation in whistleblower recoveries.1,4 This inside perspective gives us valuable insight into what it takes to build a strong case for the government.
Carolina Whistleblower Attorneys has represented dozens of whistleblowers, with tens of millions of dollars in total settlements since 2016.1 Lead attorney Bill Nettles was responsible for helping the government recover over $307 million in fraudulently-obtained funds during his tenure leading the U.S. Attorney’s Office for South Carolina.1,4
If you have knowledge of fraud against the government, you have the power to try to do something about it. Contact Carolina Whistleblower Attorneys at 1-888-292-8852 or through our online form for a free, 100% confidential case evaluation and conversation. Our experienced team can explain your rights and options. And if you choose to partner with us, you pay no fee unless we obtain a financial recovery for you. Guaranteed.2
Let’s fight together to stamp out corporate greed.
“Bill has the ability to ‘think outside the box’…which makes him extremely effective as an advocate for his clients.” 1 — Attorney who previously worked with Bill
Awards we’ve won
For standards of inclusion for awards listed, visit bestlawyers.com, thenationaltriallawyers.org, superlawyers.com, farrin.com/business-nc-power-list, and millondollaradvocates.com. National Trial Lawyers Top 100 designation is for 2025. Regarding the Million Dollar Advocates Forum, we do not represent that similar results will be achieved in your case. Each case is different and must be evaluated separately. Firm award is for the Law Offices of James Scott Farrin. Attorney awards are for attorneys with the Law Offices of James Scott Farrin.
Contact the Carolina
Whistleblower Attorneys
If you’re wondering if it’s a good idea to speak with a whistleblower lawyer about what you know, let us set the record straight.
- Corporate ethics hotlines can be risky and may lead to termination. If you’ve already done this, call us immediately.
- Your coworkers could be aware of the fraud – or complicit in it – and you should not talk to them about it.
- The first claim to be filed under the False Claims Act can proceed – if you’re not first, you’re at a serious disadvantage and may get nothing (another reason not to speak to your coworkers about it).
- A confidential discussion costs you a few minutes, but could save you time, stress, and money.
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