What compensation can a Relator/Whistleblower earn?

Finding fraud against the government can be a difficult business. Many frauds are complex and cleverly concealed by the fraudsters. Entire teams of government auditors and investigators never find the fraud working alone.

Other times, the fraud is more obvious, but the government agents in charge of disbursing funds are so overworked or overburdened that they cannot detect the fraud by themselves.

The False Claims Act has an answer. The Act recognizes that one honest employee can do more to uncover fraud then hundreds of Government auditors or investigators.

But how to motivate that honest employee to come forward? After all, becoming a whistleblower is difficult, and the employee might face ridicule, retaliation, and oppression at work.

One answer lies in the financial incentives offered to whistleblowers. If a whistleblower files a qui tam case, and the Government intervenes in that case, whistleblowers are entitled to recover “at least 15 percent but not more than 25 percent” of the proceeds of the action under 31 U.S.C. § 3730(d). This means the whistleblower gets a portion of the Government’s recovery as reward for blowing the whistle.

If the Government does not intervene, and the whistleblower elects to continue the case on his or her own, the whistleblower is entitled to a larger reward – between 25 percent and 30 percent of the recovery. This is because the whistleblower and his or her lawyers do more work in a non-intervened case.

The money awarded to the whistleblower is usually referred to as the “Relator’s Share.” The Department of Justice determines the exact amount to be awarded to the whistleblower based upon a number of factors, such as the value of the information provided by the whistleblower, and whether the whistleblower came forward immediately or waited for a long time to report the fraud.

The whistleblower and his or her lawyers usually negotiate an agreed Realtor’s Share amount with the Department of Justice. In the event the Relator and Department of Justice cannot agree, the False Claims Act allows the Court to decide the amount of Relators Share.

In all cases, the Court has discretion to reduce the Relator’s Share if it finds that the whistleblower “planned and initiated” the wrongful conduct at issue.

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