Most whistleblowers are ordinary employees doing their jobs. According to a 2007 National Business Ethics Survey, 56% of all employees witness fraud or some type of illegal misconduct at work. If you suspect that fraud may be occurring in your workplace, but aren’t sure how to proceed, keep reading or get in touch today.

IDENTIFY THE TYPE OF FRAUD

There are a handful of whistleblower programs and laws that govern different types of whistleblower fraud. The specific type of fraud determines the best federal law for you to file a whistleblower claim under as each set of whistleblower laws are different.

Note that certainly not all acts of whistleblowing are actionable in the US. Whistleblower legal actions involve formal lawsuits or formal government filings that meet the criteria of a particular whistleblower law or program. 

REPORTING FRAUD AGAINST THE U.S. GOVERNMENT VIA LEGAL ACTION

In order to initiate a lawsuit under the False Claims Act, which is the chief whistleblower tool available to whistleblowers, the fraud the whistleblower bases the legal action on must involve big losses of money to the federal government or to a state government with its own False Claims Act, or must involve a significant violation of the terms of a government contract. In addition to formal, legal proceedings under the False Claims Act or an analogous state component, whistleblowers may also possess information and evidence entitling them to file an agency whistleblower submission with the Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), Internal Revenue Service (IRS), or the Financial Crimes Enforcement Network (FinCen). Agency whistleblower filings involve filing based on information involving a violation of the laws and regulations the particular governmental agency is responsible for enforcing. 

All forms of fraud against the United States government can be reported by filing a qui tam case (another term for a whistleblower case) under the False Claims Act (FCA). The FCA requires that whistleblowers are represented by a lawyer when filing a claim.

REPORTING STOCK FRAUD AND VIOLATIONS OF SECURITIES LAWS

Employees of financial institutions or individuals who become aware of a corporation or individual committing stock fraud may file a whistleblower claim through the Securities and Exchange Commission (SEC) Whistleblower Program. The SEC’s Whistleblower Program operates under the requirements and provisions of the 2010 Dodd-Frank Act.

Whistleblowers can submit a claim using a special form called a TCR to the SEC. SEC Whistleblowers can submit their claim anonymously by hiring a whistleblower lawyer to act as their proxy.

REPORTING TAX FRAUD

Persons who learn of a company or individual evading taxes or committing tax fraud may file a tip through the Internal Revenue Service (IRS) Whistleblower Program if the amount of tax fraud exceeds $2 million. 

The IRS Whistleblower Program allows whistleblowers to file a claim by completing IRS Form 211. A whistleblower may hire a lawyer to make this report anonymously as well, similar to the SEC Whistleblower Program.

REPORTING BRIBERY OF FOREIGN OFFICIALS

The Foreign Corrupt Practices Act (FCPA) prohibits individuals and companies from bribing foreign officials in order to obtain favorable business terms. The FCPA works in conjunction with the Dodd-Frank Whistleblower reward program to allow both U.S. citizens and foreign residents to report bribery and collect rewards through the SEC whistleblower program. Since its enactment in 1977, the FCPA has led to over 200 enforcement actions and resulted in approximately $7.1 billion in penalties.

Learn more about the FCPA.

No matter which program is best suited for your case, it’s important that you and your attorney ultimately decide on a course of action that will best protect you from any potential retaliation by a vengeful company. A successful plan for reporting fraud will maximize the probability of receiving a whistleblower reward while also protecting you from retaliation and securing your future professional life.