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Whistleblowers/Qui Tam Archives

SEC Anticipates Increase in Whistleblower Tips

The Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank") is one of many laws that protect consumers from fraudulent acts committed by corporations. In order to increase transparency and expose organizations that engage in illicit activity, Dodd-Frank includes a "whistleblower program" that incentivizes individuals to come forward with information regarding possible securities law violations. If the information is original and leads to a Securities and Exchange Committee ("SEC") enforcement action in which more than $1,000,000 in sanctions is ordered, the SEC is authorized to provide monetary awards between 10 to 30 percent of what it collects to the individual.

Anti-Kickback Case Settles for Record-Setting $17 Million

Just one week ago, the Hebrew Homes Health Network, Inc., along with its former president and executive director, came to an agreement with the authorities: They would pay $17 million to close the False Claims Act case against them.

Blowing the Whistle on an Employer's Illegal Actions to Defraud Government

U.S. businesses are required to follow and abide by various legal rules and regulations. Many of the laws that govern U.S. business activities are in place to protect consumers and the environment. Additionally, regulatory measures have been enacted to ensure for the safety and wellbeing of employees as well as to safeguard against unfair and deceptive business practices.

Food Service Company Settles Whistleblower Case with D.C. Schools

Washington D.C. ("D.C.") public schools have reached a $19.4 million settlement with Chartwells, a food contractor that is a subsidiary of Compass Group USA Inc. The D.C. school district alleged that Chartwells violated the United States False Claims Act by overcharging schools when providing its meal programs for children. Specifically, the complaint alleged that Chartwells was "obligated to purchase food 'at the lowest possible price'" but the company "used a corporate affiliate to purchase foods from 'companies that manufacture highly processed foods and charge higher prices.'" Additionally, the whistleblower, Jeffery Mills, ("Mills") who was previously Director of Food and Nutrition for D.C. public schools, alleged that Chartwells delivered food late, often spoiled, and frequently in inadequate amounts. Providing nutritious and quality food for students is especially important in D.C., where "a majority of students are poor, and many rely on the school nutrition program for meals."

UPS Agrees to Settle Whistleblower Claims for $25.7 Million

Government customers of United Parcel Service Co. (UPS) overpaid the company because it falsified delivery records over a 10-year period, according to a lawsuit UPS recently settled. The whistleblower suit was filed by a former driver and manager for UPS. Now he is expected to receive $3.75 million for bringing the allegedly false claims to the attention of the federal government.

United States Intervenes on Another Medicare Fraud Case

Several former employees of HCR ManorCare, Inc. ("HCR") brought False Claims Act ("FCA") complaints against HCR, a nationwide nursing home company. The United States Department of Justice ("DOJ") has decided to intervene in the case, which alleges that the company's leadership forced employees to provide unnecessary and possibly harmful care to patients in order to bill the Government for more money.1

Whistleblower Claims Medicaid Fraud Resulted in Harm to Mothers and Babies

According to a recently unsealed whistleblower lawsuit, two health care providers in Indiana put the health of mothers and newborns at risk in a Medicaid fraud scheme that placed the care of low-income, pregnant mothers in the hands of lower-cost midwives rather than doctors. The suit alleges that the health care providers -- IU Health and HealthNet Inc. -- then falsely billed Medicaid for doctor-provided services.

With $48.5 Million, Laboratories Settle Claims of Kickback Violations and Medicare Fraud

According to current figures from the U.S. Department of Justice, since 2009, legal claims brought under the federal False Claims Act have led to the recovery of more than $23.9 billion. About 63 percent of that -- more than $15.2 billion -- has been recovered from cases involving fraud against health care programs, including Medicaid and Medicare.

Harsh Threats Claimed in Whistleblower Suit against TPG Capital

A former managing director for private equity firm TPG Capital has filed a whistleblower lawsuit against his ex-employer. According to the suit, rather than using investor fees for their intended purpose -- to pay for the services of consultants and advisers -- TPG regularly used the fees to pay its own employees. This practice allows for double-billing by private equity employees, who bill once as a firm employee and again as a consultant to the companies in which the firm has invested.

The SEC Emphasizes Protection of Whistleblowers

The Securities and Exchange Commission ("SEC") has been investigating businesses for violations of Rule 21F-17, which provides whistleblowers with protections against retaliation by their employers. Specifically, the SEC is investigating companies "using confidentiality agreements to prevent employees from communicating with the SEC about potential securities law violations."1 Recently, the SEC settled a case against Kellogg, Brown & Root ("KBR"), a former Halliburton subsidiary, for using such contract language. While the SEC did not find that KBR ever enforced the illegal language in its confidentiality agreement, it found that the language could have a "potential chilling effect" and could discourage employees from bringing claims, in violation of SEC rules. As a result of the settlement, KBR agreed to pay $130,000 and change its employee confidentiality agreement to remove the detrimental language.2