2. INTRODUCTION
• Origin in 14th century England
• Trans-Atlantic trek to the New World
• Development from 17th century

3. qui tam pro domino rege quam
pro se ipso in hac parte sequitur

4. “...no officer in City or in
Borough...shall merchandise
for Wines ... And if any do,
and be thereof convict, the
Merchandize whereof he is
convict shall be forfeit to the
King, and the third part
thereof shall be delivered to
the Party that sued the
Offender, as the King's Gift.”
-King Edward II

5. In 1623, the royal colony of Massachusetts
enacted a colonial law stating:
“penalties for fraud in the sale of bread
[are] to be distributed one third to
inspector who discovered the fraud
and the remainder for the benefit
of the town where the offense
occurred.”

6. Second Continental Congress…
Enacted first whistleblower law July 30, 1778

7. ⦁ The first whistleblower law was Congress’ response
to an incident in 1777, involving two whistleblowers
Richard Marven and Samuel Shaw, who suffered
retaliation by naval commander-in-chief Esek Hopkins.
⦁ The Second Continental Congress declared that the
United States would defend both whistleblowers against a
libel suit filed by Commander Esek Hopkins.
⦁ Congress declared it the duty of “all persons in the
service of the United States, as well as all other the
inhabitants thereof" to inform the Continental Congress
or proper authorities of "misconduct, frauds, or
misdemeanors committed by any officers in the service
of these states, which may come to their knowledge."

11. ⦁ In 1985, a government report stated
that 90% of the largest defense
contractors were under investigation for
defrauding the government…
⦁ The report estimated that the fraud
on the government could be costing
taxpayers from $10 billion to $100
billion annually…
⦁ In response, the following year in
1986, Congress moved to strengthen key
provisions of the Lincoln Law

14. Key Provisions of the False Claims Act:
⦁ Statute of Limitations: no later than 3 years after notice to U.S.
Attorney General
⦁Standing to sue: whistleblower must be an “original source”
⦁Filed In camera (under seal)
⦁If the government declines to join qui tam suit, the relator may
pursue the claim In propria persona on behalf of the government
⦁ If the government joins the payout is 15% to the whistleblower,
otherwise the payout is 30% of the total recovery (e.g. imagine 30%
of $30,000,000…)
⦁ Retaliatory protection from employer including reinstatement with
double back pay

15. “Recoveries from
our lawyers'
whistleblower
cases total more
than $11 billion
from civil
settlements and
related criminal
fines...”

16. Phillips and Cohen, LLP notable settlements:

17. “From fiscal years 1987 through 2005,
settlements and judgments for the
federal government in whistleblower
cases exceeded $15 billion, of which
$9.6 billion, or 64 percent, was for
cases filed by whistle blowers under
FCA’s qui tam provisions. The whistle
blowers share of the qui tam
settlements and judgments was over
$1.6 billion during this period…”

19. What IRS whistleblowers can expect:
 15% to 30% of the total amount the IRS collects
due to exposing the tax fraud
 To have standing, an IRS relator must expose at
least $2million in underpayment from a tax cheat
earning at least $200,000 annually
 If the whistleblower initiated or planned the tax
fraud, the IRS may reduce/deny the reward
 The IRS will keep the relator’s identity private, and
issue payout only after a complete investigation of
tax underpayments, and recovery
 If the IRS fails to pay the reward, the relator may
appeal to the U.S. Tax Court

20. Sarbanes–Oxley Act 2002
⦁ Enacted July 30, 2002
⦁ Known as “the Public Company Accounting Reform and
Investor Protection Act” in the Senate
⦁ Titled: “the Corporate and Auditing Accountability and
Responsibility Act” in the House of Representatives
⦁ Named after Senator Paul Sarbanes (D-MD) and U.S.
Representative Michael Oxley (R-OH)

21. Key Provisions of Sarbanes-Oxley :
⦁ Set new standards for all U.S. public
company boards, management, and
public accounting firms…
⦁ Top management must certify in
writing the accuracy of financial
reports about the company…
⦁ Employers are prohibited from
retaliation against employee who
report unethical conduct...

22. CONCLUSION
In summary, to answer “What is a Whistleblower?”
We started at the beginning in 14th century England,
across the Atlantic Ocean to the New World where
the royal colonies enacted similar laws, through the
American Revolution and Civil War, culminating with
Sarbanes-Oxley in 2002. By so doing, we all now
have a more fuller appreciation of the vital role
whistleblowers play in the war on fraud.