May 20th, 2019

One of the ways the government makes reporting fraudulent activity attractive is by offering cash incentives, or settlements. However, although there are obvious monetary benefits to blowing the whistle, there are other points to think about when you are considering bringing a case out into the open. The first is the cost to you, personally, such as the cost of retaliation, the time dedicated to your case that will be lost, as well as the cost of lost wages. The other consideration is more positive, and that involves the monetary gains that will come to you from blowing the whistle and reaching a successful outcome.

A Look at the Calculations Behind a Whistleblower’s Share

Determining how much you stand to gain if your case is successful is useful in clarifying whether blowing the whistle is the right approach for you. The starting point for this calculation is the settlement amount that the government agrees to with the defendant company.

Beyond that, there are several fairly standard steps that determine the amount the whistleblower receives. The first step is to calculate what your “relator’s share” of a settlement will be if the case is settled. This amount can be somewhere around 15 to 30 percent of the government’s settlement but depends on a number of factors, including how much you helped with the investigation.

To understand how the math works, think of this example.  If the government settled for $10 million, and your relator’s share was 15 percent, you would initially get $1.5 million. The next step is to deduct the attorney fees from that share, which would likely be somewhere around 40 percent, which leaves the adjusted amount at $900,000, using the example above. This is your share, which will also be subject to state and federal taxes. Although it varies depending on the state you live in as well as your personal tax situation, this can also be estimated to be around 40 percent. With that, the initial $10 million settlement amount has now been reduced to $540,000 in this example. Of course, there can be numerous factors that affect the actual amount.

Even though whistleblower cases can range in amounts and have numerous factors to consider, these rough guidelines can give you an idea of how much you could get by blowing the whistle. Whistleblowers should think through the financial costs and compare them with the final settlement amount to determine how much the gain will be.  Overall, it is best to work with a skilled and experienced whistleblower attorney who can guide you and offer advice throughout the claim-filing process. Reach out to The Whistleblower for more information if you think you have a claim.