Employees Are Very Reluctant to Report Fraud to Federal Law Enforcement

The Chamber of Commerce has commenced a well-financed and aggressive lobbying campaign to undermine America’s most effective whistleblower law, the False Claims Act. To justify its anti-whistleblower campaign the Chamber published a report entitled, “Fixing the False Claims Act: the Case For Compliance-Focused Reforms.” The purpose of this blog series is to combat the Chamber’s misinformation, and explain why the False Claims Act must be protected.

Whistleblowers and their supporters are strongly urged to read this blog series and share it with friends. In addition, an Action Alert has been issued by the National Whistleblower Center so members of the public inform their representatives that the False Claims Act should not be “reformed” as proposed by the Chamber.

Fact Number 4:

Below are the actual reporting characteristics of all employees’ reporting behavior in the U.S.

* Based on the statistics reported in “Inside the Mind of a Whistleblower” Report by the Ethics Resource Center (2012). 

As reported by the corporate-sponsored Ethics Resource Center, only 2% of all employees who are willing to report misconduct initially disclose that misconduct to anyone outside their company, including law enforcement.

The FCA is the federal law that directly addresses this crisis in enforcement. A majority of employees are already willing to report fraud to their managers or compliance programs. That is not the problem.

The problem is that without laws such as the FCA, law enforcement agencies cannot gain access to the vast majority of employees who witness fraud against taxpayers.

The FCA is the most effective whistleblower law addressing this major problem. The Chamber’s proposals would greatly exasperate the current failure of employees to properly report fraud to law enforcement. It would undermine 25 years of progress triggered by the FCA’s whistleblower qui tam provisions.


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