California False Claims Act – Qui Tam Whistleblower
Passed in 1987, California’s False Claim Act (FCA) was modeled after the newly amended federal false claims act [link to fed page]. The California False Claims Act permits the Attorney General to bring a civil action to recover damages and penalties against any person who knowingly uses or makes a false statement or document, to obtain money or property from the State or avoid paying to the State.
California also allows for “qui tam” lawsuits, which are civil suits brought by a whistleblower (or “relator”) to prosecute false claims on behalf of the state and obtain a portion of the award. Though the government may, upon review of the allegations, join or “intervene” in the lawsuit, the whistleblower is still eligible to receive a percentage of the recovery (15-33%), depending upon the extent of his/her contribution to the prosecution of the fraud.
California False Claims Act
The California False Claim Act makes it illegal to knowingly do any of the following:
- Present or cause to be presented to the government a false claim for payment or approval;
- Make, use, or cause to be made or used a false record or statement to get a false claim paid or approved by the government;
- Conspire to defraud the government by getting a false claim allowed or paid;
- Deliver or cause to be delivered less public property or money than reflected on a receipt or certificate;
- Make or deliver a receipt by an authorized person that falsely represents the property to be used by the government;
- Buy or receive a pledge of public property from any person who may not lawfully sell or pledge it;
- Make, use, or cause to be made or used a false record or statement to conceal, avoid, or decrease an obligation to pay or transmit money or property to the government (also known as a reverse false claim); or
- Be the beneficiary of an inadvertent false claim who discovers its falsity and fails to disclose it to the government within a reasonable time.
Though very similar to the federal False Claims Act, the California False Claims Act differs from its federal counterpart in that it makes illegal an additional category of conduct: failing to report an inadvertent benefit after discovering it. Thus, if a party inadvertently submits a false claim and fails to report the mistake to the government once discovered, that party can be potentially liable under the California False Claims Act. Failure to report it after discovery of the inadvertent false claim can lead to the same penalties as knowingly committing the original act.
California False Claim Act Penalties
Like its federal counterpart, the California FCA provides for “treble” damages – that is, a person who violates the FCA is liable for three times the amount of damages sustained by the government. The California FCA also penalizes each instance of misconduct up to $10,000 and allows for individual whistleblowers and their attorneys to file qui tam lawsuits. Whistleblower rewards can be up to 50 percent of the amount recovered on behalf of the government.
California False Claim Act Rewards
The California FCA rewards whistleblowers who prosecute false claims on behalf of the government to up to 50 percent of the total amount recovered by the state. Given the significant penalties and fines provided under the California FCA, the whistleblower reward can be substantial. For example, in 2018, one whistleblower received $27 million after a natural gas company agreed to pay $102 million to resolve claims it overcharged the state of California for natural gas.
California False Claim Act Rules
California Government Code Section 12650:
California Government Code Section 12651:
California False Claim Lawyer
Schneider Wallace represents California whistleblowers. Schedule a consult with our false claim lawyers for a free and confidential consultation. Contact us at 1-800-689-0024 or firstname.lastname@example.org.