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Laws protecting and rewarding whistleblowers

On Behalf of | Nov 5, 2021 | Uncategorized

One of the most significant results of the Enron scandal of the 1990s was the enactment of the Whistleblower Protection Act that further enhanced the Civil Service Reform Act of 1978. This law protects insiders from retaliation and prosecution when they turn state evidence, including in Alabama. The claims are actually prosecuted under either of three other legislative acts regarding banking and taxation. Not only can whistleblowers claim protection while requesting anonymity, they are also allowed to file qui tam lawsuits against the party they are accusing.

What is a qui tam lawsuit?

The term actually means “in the name of the King” and is borrowed from the British legal system. It provides standing for the whistleblower to file a lawsuit against the party they are turning evidence against after they present the evidence on behalf of the jurisdictional oversight government agency in federal court under absolute anonymity. They are also protected against retaliation by any accused employer or third party, and they have standing once again for more whistleblower claims if they are victimized for providing the evidence.

Whistleblower damages

Whistleblower claims are generally focused on some type of governmental financial fraud. The individuals who are bringing forth information for the prosecution are allowed a percentage of the total proceeds recovered by the particular government agency, such as the SEC, FBI, or the IRS. Whistleblower claims typically result in the informant receiving between 10-30% of the total collected revenue based on the type of information presented and the law being used to repatriate the funds.

Whistleblower claims are actually prosecuted under either the Dodd-Frank Act, the False Claims Act, or the IRS Whstleblower Law. The amount of payment is determined by the federal court of jurisdiction based on the business location of the entity and the type of fraudulent activity being reported.