Reward Determination

The reward a whistleblower receives is calculated as a percentage of the amount recovered by the government. The False Claims Act provides that if the government "intervenes" and assumes a leading role in the case brought by the whistleblower, the reward will be between 15 and 25 percent of the amount recovered. If the government decides not to intervene, and the whistleblower and his counsel pursue the action without the government's assistance, the whistleblower's share goes up to 25 to 35 percent of the recovery.

Under the False Claims Act, the government's recovery is determined by the amount of damage the fraud caused the government to suffer, and the number of false claims submitted. The Act provides that the government can recover three times the damages it actually suffers as a result of the fraud, plus $5,000 to $10,000 per false claim. For example, if a health care provider submits 100 fraudulent reimbursement claims to Medicare for services never rendered, the government's recovery could equal three times the total amount paid to the health care provider, plus an additional $500,000 to $1 million.

While the Act provides for treble damages and per claim penalties, in practice the government's recovery is usually less than the maximum allowed. Where the evidence of fraud is compelling and the Department of Justice elects to play a lead role in the case, most defendants settle. And, recognizing the savings and inevitable risks involved in going to trial, the government agrees to accept less than the maximum possible recovery.
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