The term “qui tam” has a long history in the law. The term itself is an abbreviation of a Latin phrase meaning “to sue in the name of the king” and came to the U.S. via English common law. Essentially, it allows an individual to act on behalf of the government to end a corrupt practice.
Civil War contractors and the False Claims Act
While the basis for qui tam lawsuits existed for centuries, they didn’t pick up in the U.S. until after the American Civil War. During the war, there were reports of contractors manipulating and deceiving the Union by providing sub-par supplies. Those supplies hurt the war effort and lined the pockets of both suppliers and those that conspired in the Union army.
Indeed the law’s original intention was stated by its legislative managers to allow “a reward to the informer who comes into court and betrays his co-conspirator.” This means that the U.S. government has a law on the record available to reward people who take a risk to end a destructive practice.
Qui tam whistleblowers and compensation
Since the post-reconstruction era, the False Claims Act has been available to support those pursuing the right result on behalf of the government. The awards for whistleblowing can be significant depending on the penalty and the government’s actions:
- The government awards between 15% and 25% of the money it receives, if you bring a qui tam complaint and the government ultimately gets money back from the wrongdoers.
- The largest award, 25%-30% of the penalty, is reserved for those who prosecute the qui tam lawsuit themselves, without government involvement.
The percentages become even more significant when you realize the penalty for defrauding the government can be up to 3 times the amount taken.
Good for the general public and good for you
When people talk about heroes, they generally refer to firefighters, soldiers, and other emergency responders, but those people receive compensation for their work and the risks they take. Getting a reward for doing the right thing only makes sense.