False Claims


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Sarbanes Oxley : Law : Thought Leader

False Claims

Stuart Chanen
Partner
Katten Muchin Rosenman LLP

As cases of corporate fraud have become increasingly complex in recent years, the federal government has had to rely more and more on private citizens, or whistleblowers, to be its eyes and ears in identifying fraud that might otherwise go undetected.

The whistleblower provision of the False Claims Act, which allows private citizens to sue corporations for fraud on behalf of the federal government, has created a new legal practice for private attorneys in alliance with federal prosecutors, which was virtually nonexistent as recently as the mid-1980s.

?While there is no question that the whistleblower provision is a significant benefit to the government in ferreting out cases of corporate fraud, not all whistleblowers are created equal.? says Stuart J. Chanen, a partner in the Litigation Department of Katten Muchin Rosenman LLP (Chicago), who concentrates his practice in the area of white collar crime and internal fraud investigations.

?Whistleblowers think they are seeing the whole picture, but often, they are simply just not. They might be seeing a single supervisor who is deviating from company policy, or they may see a series of false claims in Column A but don't see the correction in Column B.

Something might look out of place or incorrect or fraudulent, but in reality, it isn't so.? Following Sarbanes-Oxley, the number of whistleblower claims has increased and even state and local governments are passing comparable false claim statutes.

Mr. Chanen is in a unique position to comment on these new laws and increasing claims because he has handled whistleblower cases as a plaintiff, government, and defense attorney. Mr. Chanen is available for interviews or to write an article on this topic.

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