CARES Act Whistleblower

Reporting Fraud as a CARES Act Whistleblowers

The CARES Act created much-needed economic relief for American workers and small businesses. When an individual or business accesses these relief funds illegally, not only are they breaking federal law and wasting federal tax dollarsâ€”they are also reducing the pot of funds available to those in need.

CARES Act whistleblowers--usually employees of a lender bank or a company that received CARES Act relief--report fraud on behalf of the U.S. government. Filing a CARES Act whistleblower claim is a courageous act that exposes waste and abuse, for which the whistleblower may be entitled to a cash reward. This page provides full CARES Act whistleblower information including whistleblower protections and rewards.

The CARES Act

The CARES Act is the largest relief package in American history, totaling $2.2 trillion to stave off the economic effects of COVID-19. A portion of the CARES Act includes loans and grants designed to bolster small businesses. Among the programs created by the CARES Act is the Paycheck Protection Program (PPP). The CARES Act also expanded the Economic Injury Disaster Loan (EIDL) program from the Small Business Administration (SBA). These programs created low-interest, forgivable loans for small businesses to prevent layoffs.

CARES Act Whistleblower Law

Numerous reports of loan fraud have surfaced as individuals from inside banks and within corporations bring abuse to light. Known as CARES Act whistleblowers, persons reporting fraud are protected by the federal and state laws. CARES Act whistleblowers are guaranteed protections from employer retaliation and are promised significant compensation in successful cases.

CARES Act whistleblowers may report a range of fraud, abuse or violations of loan programs, such as wire fraud, bank fraud, money laundering, and other false claims through filing a qui tam lawsuit. This legal avenue was created by the False Claims Act (FCA), which goes back to the Civil War, when it was enacted by Abraham Lincoln.

Examples of CARES Act whistleblower reports include:

applying for PPP funds on behalf of a phantom company
falsely certifying that "current economic uncertainty makes this loan request necessary to support the ongoing operations of the applicant"
applying on behalf of a business with more than 500 employees, or whose net worth or income exceeds allowable thresholds
claiming employees on payroll who are non-existent or who are deceased
misrepresenting the number of employees or their country of residence
using funds to cover costs other than the business-related purposes defined by the PPP, which include retaining workers / maintaining payroll or making mortgage interest, lease or utility payments

CARES Act Whistleblower Protections

The False Claims Act and similar laws in many states provide a number of CARES Act whistleblower protections. These laws apply to any person who has inside information on PPP loan fraud, abuse, or waste, providing measures to protect from retaliation by the whistleblower's employer.

CARES Act whistleblower claims usually originate from an employee (or past employee) of a bank processing loans or a company that has received CARES Act funds, though any individual may file a claim. The first step is for the individual to reach out confidentially to an attorney for legal representation. Our firm then works to prepare the case, investigating the facts and allegations in light of relevant areas of the law and preparing a draft complaint.

Upon filing a CARES Act whistleblower claim, the identity of the "relator" or whistleblower is kept confidential, or "under seal" during a period of investigation by government attorneys. During this time, the entity under investigation is not yet aware of the claim.

If the case moves to the next stage, the defendant is informed of the complaint and the identity of the "relator" then becomes known. Litigation may follow, ending in either a settlement or a trial and verdict. At this juncture, the CARES Act whistleblower is protected from employment discrimination. If the employer does fire or demote the whistleblower, the False Claims Act provides for 2x back pay plus interest, compensation for damages, and reinstatement of employment at the same seniority level.

CARES Act Whistleblower Rewards

If a settlement is reached or a court finds in favor of the government, CARES Act whistleblowers may be entitled to a share of the damages. Depending on the circumstances, federal law awards the whistleblower between 15% and 30% of the damages recovered.

Under the False Claims Act, specifically, the government is entitled to threefold damages through whistleblower law. CARES Act whistleblowers receive up to 30% of this sum as a reward. For example, if a company received $350,000 in PPP loan funds, the government may recover more than $1 million. A CARES Act whistleblower could receive up to $315,000 in rewards.

Let Our CARES Act Whistleblower Lawyers Help You

Our attorneys specialize in rooting out fraud and negligence on behalf of the American people. Our utmost goal is to ensure our clients receive the utmost protections and maximum compensation allowable by federal and state law. Let us help you today.

CARES Act Whistleblower Lawsuits

If you are privy to information proving an individual or business has engaged in PPP loan fraud, filing a claim is the most effective means to hold the company accountable while receiving protections for yourself and your family. Whistleblowers are compensated for this act of bravery and have the satisfaction of exposing waste and abuse. Contact us today for a confidential, no-cost consultation.