Qui Tam Actions generally are lawsuits in which an individual sues on behalf of a governmental entitiy, typically the Federal Government, with the goal of remedying a defrauding of the government by a private organization or individual. These actions typically take the form of a whistleblower exposing the defrauding actions of his or her employer. Qui tam actions in the US are often brought under the False Claims Act, a Federal law specifically empowering individuals to sue as whistleblowers to recover private funds garnered through defrauding the Federal Government.
In the foreclosure context, individuals who are connected with, or in some cases simply apprised of, the defrauding behavior, can then bring a qui tam action to remedy the fraud. As a whistleblower, the suing individual is entitled to substantial compensation, including penalties, attorney's fees, court costs, on top of the disputed amount of the fraud. The whisteblower receives his or her compensation as a percentage of the fraud money recovered. This amount can and often does run into the millions of dollars, depending on the nature of the fraud and the amount in dispute. Bill will highlight a recent successful qui tam action and address previous qui tam matters, involving for example mortgage servicers such as Nationstar.