This post addresses the legal remedies available to individuals who expose fraud perpetrated by companies against the government.
In 2013, the Florida False Claims Act was substantially amended to conform with the federal counterpart, the False Claims Act. The Acts permit private individuals to bring lawsuits, also known as “qui tam” lawsuits, in the name of the government against companies that have defrauded the government. Generally speaking, lawsuits brought pursuant to the Acts cannot be based on information that is widely known to the government or the public. In other words, the private individuals bringing the lawsuits must generally be considered the original source of the information that exposes the fraud, although there are exceptions depending on the place of the public disclosure.
Under the Florida False Claims Act, it is unlawful for companies that do business with the government to knowingly:
- Submit false or fraudulent claims for payment to the government.
- Make or use false records to support false or fraudulent claims to the government.
- Make or use false records to change an obligation to pay money to the government.
- Conceal, or improperly avoid or decrease, an obligation to pay money to the government.
Private individuals, also known as whistleblowers or relators, who successfully prove that companies have defrauded the government may share in the damages recovered in the lawsuit. The damages for violation of the Florida False Claims Act may be substantial. The damages include a penalty equal to three (3) times the amount of damages, and a statutory fine of $5,500 to $11,000 per violation.
A specific procedure must be followed in order for a private individual to pursue a lawsuit under the Florida False Claims Act. The government is first provided with an opportunity to take over the lawsuit, and if it does not elect to take over the lawsuit, the private individual may continue the case on his or her own. Under Florida law, if the government takes over the lawsuit, the whistleblower may recover at least 15% but not more than 25% of the damages recovered. If the government does not take over the lawsuit, the whistleblower may recover between 25% and 30% of the damages recovered.
Some of the common types of fraud against the government:
- General contractors who submit bogus claims for payment to the government on all types of construction projects, such as buildings, roads, and parks.
- Subcontractors who submit bogus claims for payment to general contractors hired by the government on all types of construction projects.
- Businesses who submit overly inflated claims for payment to the government for products and services used by the government.
- Business who purposely underpay obligations owed to the government.
Notably, the 2013 amendments to the Florida False Claims Act now allow whistleblowers to seek recovery on behalf any instrumentality of Florida state government (i.e., departments, divisions, bureaus, districts, agencies, etc.). Whistleblowers can also seek recovery on behalf of Florida counties and local municipalities that have been defrauded by businesses.
Please contact Ewusiak Law, P.A. for more information.