Private parties who report fraudulent government claims of business entities are known colloquially as “whistleblowers.” By reporting such misconduct and abuse, most of these informants act pursuant to the False Claims Act (“FCA”). This Federal statute provides substantial economic incentives for whistleblowers. 

Since its original inception in 1863, the FCA has undergone vast changes. Despite periodic alteration and amendment, two FCA features have remained constant: Protection and remuneration for informants. Nonetheless, whistleblowers who reveal unethical or fraudulent business activity assume major risks in so doing. 

1971 Daniel Ellsberg State Department

Mr. Ellsberg revealed the Pentagon Papers to a New York Times reporter. This now infamous document was a top-secret government account of the war in Vietnam. It contained details of extensive corruption and deceptive practices of high government officials. The resulting scandal played a major role in eroding public support of American involvement in the war.

1973 Stanley Adams Hoffmann-LaRoche

Upon discovery of Antitrust violations, Mr. Adams presented hard evidence to the European Economic Community (“EEC“). After his identity was inadvertently disclosed to Hoffmann-LaRoche, Mr. Adams was jailed for six months. Following a decade-long struggle, his name was finally cleared and he received reparation from the EEC.

1984 John Michael Gravitt General Electric

Mr. Gravitt holds the distinction of being the first whistleblower to initiate qui tam litigation after the FCA was significantly weakened by legislative amendment in 1943. Mr. Gravitt disclosed GE’s fraudulent billing of the US Dept. of Defense in connection with B1 Lancer bombers. Following complaints to his employer, Mr. Gravitt endured severe reprisals. His subsequent lawsuit and Congressional testimony led to the 1986 re-strengthening of the FCA.

1988 Roland Gibeault Genisco Technology

Mr. Gibeault brought a qui tam action after assisting an FBI investigation into Genisco’s fraudulent testing of HARM missile parts. Three high-ranking corporate executives received federal prison terms in the resulting fiasco. Although Gibeault’s employment was terminated subsequently, he initiated further qui tam claims against Texas Instruments (“TI”). Genisco was a TI subsidiary.

1989 Myron Mehlman Mobil

A Mobil toxicologist at the time, Mr. Mehlman cautioned his employer that petroleum products sold in Japanese markets contained excessive benzene levels. His warnings were to no avail. When he returned to the US, Mehlman was fired. His subsequent qui tam suit was successful.

2005 Shawn Carpenter Sandia National Laboratories

Mr. Carpenter learned that a ring of hackers employed by Sandia were engaged in widespread unauthorized access of numerous databases. Their illegal covert activities involved major US government agencies, military bases, and defense contractors. Warned not to reveal his knowledge, Sandia officials advised Carpenter that their only concern was its own computers. 

Carpenter began cooperation with the FBI and US Army to alleviate the problem. Upon discovering this, Sandia fired Mr. Carpenter and rescinded his security clearance. In 2007, the New Mexico State Supreme Court rendered a $4.7 million USD judgment against Sandia.

2009 Michael Paul Administrative Office of the Courts

As senior technical analyst of California’s Judicial Council, Administrative Office of the Courts, Mr. Paul publicly revealed fraudulent construction over billing. This misconduct involved the siphoning of tens of millions of dollars to unqualified contractors as part of a bid-rigging scheme. 

When Mr. Paul’s allegations were publicized, he was demoted. He subsequently filed suit for injunctive relief and to recover all previously-paid false claims. Shortly thereafter, he was fired. The matter remains pending in the courts.

Conclusion

The above examples illustrate the obstacles faced by those who ferret out the fraudulent waste of public resources. Although their journeys were perilous and difficult, right ultimately prevails. The wheels of justice grind slowly, but finely. 

A huge public debt is owed to these and many other courageous people of strong character. Those with knowledge of similar wrongs must speak out and take proactive, proactive measures. It is only by following such fine examples will the scales begin to balance toward restoring integrity and accountability in American industry and commerce.