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Saturday, January 1, 2011

Securities Fraud Whistleblower Bounty Actions and Financial Fraud Whistleblower Lawsuits Provide Economic Incentives to Crack Down on Securities Fraud, Derivative Fraud, Commodity Fraud, and other Financial Fraud

Financial Fraud Whistleblower Lawsuits, Securities Fraud Whistleblower Bounty Actions, SEC Whistleblower Incentive Program Claims, Derivative Fraud Bounty Actions, & Dodd-Frank Act Financial Fraud Whistleblower Bounty Actions Provide Economic Incentives for Wall Street Fraud and Financial Fraud Whistleblowers by Texas Securities, Commodity, and Financial Fraud Whistleblower Lawyer Jason Coomer

Providing economic incentives to Medicare Fraud Whistleblowers, Medicaid Fraud Whistleblowers, and Defense Fraud Whistleblowers has created Billions of Dollars in recoveries to the federal government and has helped reduce health care fraud.  Recent changes in the law are now using the power of the free market and economic incentives to crack down on financial fraud including securities fraud, stimulus fraud, derivative fraud, investment fraud, and commodities fraud.  By offering large economic incentives to highly sophisticated investors and other financial fraud whistleblowers that understand complex investment fraud financial scams,  the government is hoping that private citizens with a deep understanding of and knowledge of financial fraud will help stop several types of financial fraud.
SEC Securities Fraud Whistleblower Lawsuits, CFTC Commodity Fraud Whistleblower Lawsuits, SEC Whistleblower Incentive Program Claims, Financial Fraud Derivatives Bounty Actions, Dodd-Frank Act Financial Fraud Whistleblower Bounty Actions, & other Financial Fraud Claims, Actions, and Lawsuits
The federal government is offering financial incentives to securities fraud whistleblowers, commodity fraud whistleblowers, stimulus fraud whistleblowers, and other financial fraud whistleblowers to step up and blow the whistle on Securities and Exchange Commission SEC violations, Commodity Future Trading Commission CFTC violations, derivative fraud, and other forms of financial fraud.  Recent legislation not only strengthens existing qui tam and whistleblower protection laws, but also creates new whistleblower bounties that can be collected by whistleblowers that properly report SEC violations, financial fraud, securities fraud, commodities fraud, and stimulus fraud. 
Dodd-Frank Wall Street Reform and Consumer Protection Act Created the SEC Incentive Program Allowing New Whistleblower Bounty Provisions that allows Qualified Financial Fraud Whistleblowers, Securities Fraud Whistleblowers, and SEC Violation Whistleblowers to Collect Rewards for SEC Bounty Claims

In July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law which includes significant new financial fraud bounty whistleblower provisions.  These provisions create economic incentives for SEC violation whistleblowers and other financial fraud whistleblowers with "original information" of SEC violations and financial fraud to blow the on large scale financial fraud and SEC violations.  

These SEC bounty claims must be brought voluntarily under the SEC Bounty Programs by one or more individuals.  The whistleblower or whistleblowers must be a natural person or natural persons, companies or other entity is not eligible to be financial fraud bounty whistleblowers.  Successful SEC violation bounty whistleblowers and financial fraud whistleblowers can collect financial rewards for whistleblower bounty actions that result in the imposition of monetary sanctions of greater than $1 million dollars.  This new financial fraud SEC bounty program is called the "Securities Whistleblower Incentives and Protection". 

Through SEC Whistleblower Bounty Actions the SEC will award between ten percent and thirty percent of the money collected to a qualified whistleblower who voluntarily provides the SEC with original information about a violation of the securities laws that leads to a successful enforcement of an action brought by the SEC that results in monetary sanctions exceeding $1,000,000.00.  

So long as the financial fraud whistleblower or financial fraud whistleblowers base their claims on "original information", any person (not just an employee or insider) may file a SEC financial fraud bounty claim.  Further, if the financial fraud whistleblower is represented by an attorney, the whistleblower may file the financial fraud bounty claim anonymously.  However, before the financial fraud bounty award is paid, the whistleblower's identity shall be revealed to the SEC and SEC shall be provided information about the whistleblower that it requests. 

SEC Securities Fraud Whistleblower Lawsuits, Dodd-Frank Act Financial Fraud Whistleblower Bounty Actions, CFTC Commodity Fraud Whistleblower Lawsuits, SEC Whistleblower Incentive Program Claims, Financial Fraud Derivatives Bounty Actions, & Financial Fraud False Claims Act Whistleblower Lawsuits

Financial Fraud Whistleblower Lawsuits, Securities Fraud Whistleblower Lawsuits, Commodity Fraud Whistleblower Lawsuits, Stimulus Fraud Whistleblower Lawsuits, and SEC Violation Whistleblower Lawsuits will become more common with the enactment of laws like the Dodd-Frank Wall Street Reform and Consumer Protection Act that create bounties that can be collected by whistleblowers that properly report SEC violations, financial fraud, securities fraud, commodities fraud, and stimulus fraud that result in monetary sanctions over one million dollars ($1,000,000.00).  The SEC can award the whistleblower up to 30% of the money collected.

SEC fines like the $550 million dollar fine that Goldman Sachs agreed to pay in 2010 to settle a civil suit over a package of mortgage-backed securities designed by a hedge fund which was shorting the housing market, the $50 million dollar SEC fine of GE for accounting misdeeds when General Electric broke rules and defrauded investors, and the SEC fines to Citigroup Inc. and Putnam Investments for $20 million and $40 million, for alleged concealing from customers the fact that brokers were paid to recommend certain mutual funds, creating a conflict of interest are examples of financial fraud that Congress is hoping financial fraud whistleblowers will come forward and expose.

By creating whistleblower bounties for investors and people with specific information of financial fraud, it is expected that hard to detect financial fraud including derivative market fraud and investment fraud will be exposed to help regulate the financial market and prevent large investment corporations, banks, hedge funds, and other large corporations from committing financial fraud of billions of dollars.

Stimulus Fraud Lawsuits, Financial Fraud Qui Tam Lawsuits, and the Fraud Enforcement and Recovery Act of 2009 (May 2009)

In May 2009, the Fraud Enforcement and Recovery Act of 2009 was signed into law which makes important amendments to the country's most important tool for fighting fraud, the False Claims Act.  This new Federal False Claim Act Legislation will protect hundreds of billions spent on government programs from fraud and government waste and expand the ability of whistleblowers to collect compensation.

This Act amends the False Claims Act to: (1) expand liability under such Act for making false or fraudulent claims to the federal government; and (2) apply liability under such Act for presenting a false or fraudulent claim for payment or approval (currently limited to such a claim presented to an officer or employee of the federal government). Requires persons who violate such Act to reimburse the federal government for the costs of a civil action to recover penalties or damages.  The Act also modifies and expands provisions of the False Claims Act relating to intervention by the federal government in civil actions for false claims, sharing of information by the Attorney General with a claimant, retaliatory relief, and service upon state or local authorities in sealed cases.

The Act also redefines "claim" to include claims submitted "to a contractor, grantee, or other recipient, if the money or property is to be spent or used on the Government's behalf or to advance a Government program or interest."  This language makes explicit the ability of Government and whistleblowers to pursue subcontractors and grantees.  This expansion will create potential liability to health care providers and other businesses that contract with government programs including Medicaid and Medicare.

The Act also redefines "obligation" to include "an established duty, whether or not fixed," arising from a variety of relationships, and specifically includes obligations "arising from statute or regulation, or from the retention of any overpayment."  This change allows the government and whistleblower to pursue violations of regulatory statutes with penalty provisions as False Claims Act Case and pursue false documents which are "material to an obligation to pay or transmit money...to the Government" regardless of whether a false claim has been submitted.  For example, a government contractor who backdates records to support a claim already submitted could be liable under this expansion.

The Act also expand the anti-retaliation provisions from only employees to include "contractors and agents" who "act to stop one or more violations."  This expanded protection could extend to contractors in government-funded managed care plans who take action to stop false reporting or illegal denial of service by the plan.

These expansions to the Federal False Claims Act should increase the number of Federal False Claims Act Lawsuits and allow the Federal Government to crack down on fraud and wasteful spending as well as recoup money that has been fraudulently obtained.

The Fraud Enforcement and Recovery Act also expands federal fraud laws to encompass independent mortgage companies, which are not currently covered by antifraud statutes that apply to traditional banks. Such independent mortgage companies originated approximately half of all subprime loans in 2005 and 2006. The bill defines a financial institution that will be covered by the fraud statutes as any business that finances or refinances mortgages. The Act expands the mortgage-related violations that are subject to both criminal and civil punishments. Additionally, the legislation makes it a crime to appraise a property falsely, an effort to prevent the purposeful inflation of home value appraisals that contributed to the housing bubble and the resulting housing crisis.

The Fraud Enforcement and Recovery Act strengthens protections against attempts to defraud the federal government, particularly through the Troubled Asset Relief Program and the economic stimulus package; expands the financial instruments that are covered by the securities fraud statute; and clarifies a money laundering statute. The Act provides $490 billion in spending for investigation and prosecution of mortgage fraud, securities fraud, and fraud cases involving federal economic assistance.

American Recovery and Reinvestment Act of 2009 (February 2009)

In February 2009, the American Recovery and Reinvestment Act of 2009 was signed into law which includes significant new whistleblower provisions. Section 1553 of the Act prohibits any private employer or state or local government that receives any funds pursuant to the Act from retaliating against an employee who discloses, internally or externally, information that the employee reasonably believes constitutes evidence of one or more of a number of specified improper uses of stimulus funds, including gross mismanagement of an agency contract or grant, gross waste of covered funds, or an abuse of authority related to the implementation or use of covered funds. Section 1553 establishes procedures and damage remedies that are similar in some ways to those with which many employers are familiar under Section 806 of the Sarbanes-Oxley Act ("SOX"), but its whistleblower provisions go beyond the whistleblower protections of SOX in several respects.

TARP Fraud Whistleblower Lawsuits, Bail Out Fraud Whistleblower Lawsuits, Financial Fraud Federal False Claims Act Lawsuits, and Stimulus Fraud Qui Tam Whistleblower Lawsuits

Many financial fraud whistleblower lawsuits may include also include elements of stimulus fraud whistleblower qui tam lawsuits or other Federal False Claims Act Lawsuits.  This potential Financial Fraud Actions under the Federal False Claims Act may allow a stimulus fraud whistleblower or other financial fraud whistleblower to potentially collect a large recovery for blowing the whistle on financial fraud. 

The Troubled Asset Relief Program (TARP) is a $700 Billion Bail Out of the troubled United States Banking and Credit System.  It was designed to unfreeze the credit market and enable the government to purchase residential and commercial mortgage assets, including whole loans and securities.  Unfortunately, after it was announced numerous Corporate interests began scheming on how to get as much of the Bail Out money as possible and use the money not for its intended purpose, but to enrich the corporations, shareholders, and CEOs that were able to get a portion of the money.

If you are aware of a corporation, CEO, or individual that has fraudulently obtained Bail Out money or intentionally used this money contrary to its intended purpose, there may be a viable Qui Tam Claim that would allow you not only to recoup government money for U.S. taxpayers, but also collect a portion of that money for yourself. 

Economic Incentives for Whistleblowers Lawsuits, Government Fraud Lawsuits, and Qui Tam Lawsuits Are One of the Least Expensive and Most Effective Mean of Preventing Fraud

When a government imposes a penalty, for the doing or not doing an act, and gives that penalty in part to whistleblowers that will sue for the same, and the other part of the recovery goes to the government, and makes it recoverable by action, such actions are called "qui tam actions", the plaintiff is suing on their own behalf as well for the government and taxpayers.

Qui tam provisions of the False Claims Act are based on the theory that one of the least expensive and most effective means of preventing frauds on taxpayers and the government is to make the perpetrators of government fraud liable to actions by private persons acting under the strong stimulus of personal ill will or the hope of gain.

The strong public policy behind creating an economic gain for whistleblowers is that  the government would be significantly less likely to learn of the allegations of fraud, but for persons in certain positions with specialized knowledge of fraud that has been committed. Congress has made it clear that creating this economic incentive is beneficial not only for the government, taxpayers, and the realtor, but is an efficient method of regulating government to prevent fraud and fraudulent schemes.

The central purpose of the qui tam provisions of the False Claims Act is to set up incentives to supplement government regulation and enforcement by encouraging whistleblowers with specialized knowledge of fraud going on in the government to blow the whistle on the crime.

The whistleblower's share of recovery is a maximum of 30 percent and the government's prior knowledge of fraud now does not necessarily bar a whistleblower from collecting lost revenue. If the government takes over the lawsuit, the relator can "continue as a party to the action." The defendant is also required to pay for the relator's attorney fees. The whistleblower is also protected from retaliatory actions by his or her employer. As a result a 1986 amendment to the False Claims Act, qui tam lawsuits have increased dramatically.   Though the amendment was first made for corrupt defense contractors, the amendment has uncovered billions of dollars in health care fraud and will probably apply to fraudulently obtained TARP and Bail Out Funds. 

Securities and Exchange Commission SEC Violation Whistleblower Lawsuit, Dodd-Frank Act Financial Fraud Whistleblower Bounty Lawsuit, SEC Whistleblower Incentive Program Lawsuit, SEC Violation Lawsuit, Financial Fraud False Claims Act Whistleblower Lawsuit, Securities Fraud Action, Commodity Fraud Action, and SEC Fraud Qui Tam Whistleblower Lawsuit

Through Federal False Claims Act Whistleblower Lawsuits, Qui Tam Lawsuits, and other Government Fraud Lawsuits, billions of dollars have been recovered from fraudulent government contractors and corporations that have committed fraud and stolen large amounts of money from the government and taxpayers.

It is extremely important that Whistleblowers continue to expose fraudulent billing practices and unnecessary treatments that cost billions of dollars.   For more information on Whistleblower Lawsuits, please feel free to follow the these linkes: Medicare Fraud Whistleblower Lawsuits, Defense Contractor Fraud Whistleblower Lawsuits, Stimulus Fraud Whistleblower Lawsuits, Health Care Fraud lawsuit, Medicare and Medicaid Fraud Lawsuits, Defense Contract Fraud Lawsuits, Government Contractor Fraud Whistleblower Lawsuits, or Dentist CHIP Fraud Lawsuits and Dental Medicaid Billing Fraud Lawsuits.  For more information on Financial Fraud Whistleblower Lawsuits including Securities Fraud, Derivatives Fraud, Investment Fraud, and Commodity Fraud following the following link on Securities Fraud Whistleblower Bounty Actions & Financial Fraud Whistleblower Lawsuits.

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