Financial Fraud

Major categories of financial fraud are:

  • IRS Tax Fraud
  • Mortgage Fraud
  • SEC Fraud FCPA Fraud
  • CFTC Fraud

Examples of financial fraud perpetrated on the government, which can be recovered under the False Claims Act, IRS Whistleblower Statute and Dodd-Frank Wall Street Reform and Protection Act, include, but are certainly not limited to:

  • Bribery of foreign officials in violation of the Foreign Corrupt Practices Act
  • Major IRS tax frauds involving underpaid taxes of more than $2 million
  • Securities law violations that create an unfair playing field for the investing public
  • Mortgage origination fraud on federally insured mortgages
  • FEMA fraud, for services not provided, or provided in a substandard manner
  • Contract fraud in negotiating government contracts
  • Government grant fraud for research and education programs
  • Environmental programs funded by the government and not executed in compliance with appropriate laws & regulations
  • Fraud in bidding on licenses for telecommunications and other related government services
  • Misrepresentations in connection with municipal securities transactions

In December 2006, the IRS created its Whistleblower Office, seeking to replicate the success of the False Claims Act, which has resulted in more than $25 billion in recoveries by the U.S. government. Similar to the False Claims Act, the IRS Tax Whistleblower Rewards Program pays whistleblowers a percentage of the recovery in exchange for valuable information.

In June 2010, the Dodd-Frank Wall Street Reform and Protection Act created the SEC and CFTC whistleblower programs. Becoming a whistleblower through these programs allows you to receive from 10 percent to 30 percent of the monies collected based on your information. Remedying the compliance vacuum that exists in so many areas of our public markets is a clear focus of this Act. Another clear target of this new law is to finally curtail the rampant violations that occur under the Foreign Corrupt Practices Act by some of the largest companies in the world.

The U.S. government conducts business with many private companies and individuals, for a host of reasons. Billions of dollars expended by the Federal Housing Administration, FEMA, the Trouble Asset Recovery Program (“TARP”) and other government agencies are all subject recovery under the False Claims Act.