Benefits of Blowing the Whistle


Whistleblowers are individuals who provide information that exposes wrongdoing. In the United States, whistleblowers can file lawsuits on behalf of the government through the False Claims Act, which imposes liability on those who defraud government programs. Thanks to a brave former employee, a doctor from Murray, Kentucky ended up paying $2.79 million to settle false claims allegations related to workers’ compensation fraud. (In return for insider information, the whistleblower got a nice reward from the government for exposing the doctor’s alleged unethical billing practices.)

According to the Ethics Resource Council, 65 percent of workers who witness misconduct report it. (It’s a tough decision to make, especially if workers are afraid of retribution.) Today’s article explains that a former employee filed a qui tam action and received nearly half a million dollars for her honesty. (A whistleblower typically receives between 15 and 30 percent of the amount recovered by the government – certainly motivation to report fraud.)

The doctor at the center of today’s case was an otolaryngologist, or ear, nose and throat specialist. He knowingly submitted false or fraudulent claims for reimbursement under the Federal Employees’ Compensation Act (FECA). (FECA is the workers’ compensation program for federal employees, which is administered by the Department of Labor’s Office of Workers’ Compensation Programs.)

In the bogus claims, the doctor from Kentucky falsely stated that audiological tests were performed by licensed personnel, even though they were not. (Test results were also altered to make it appear that some patients had hearing losses, when they did not.)

 The otolaryngologist agreed to pay $2,791,758 to resolve workers’ compensation fraud allegations that he improperly billed for audiological services and hearing aids. (By agreeing to the settlement, he did not admit any liability from the alleged misconduct.) He also agreed to be permanently excluded from participating in the FECA program. On the flip side, the former employee who blew the whistle on the doctor, received $434,598.86 as a reward from the government.

Whistleblowers are often seen as unhappy, opportunistic individuals who want revenge or money. Alternatively, they can also be viewed as people who have a moral conscience and want to end fraud, waste and abuse. When whistleblowers report fraud, taxpayer dollars are saved. (Just in 2017, the Department of Justice recovered that more than $3.7 billion in settlements and judgements from cases involving fraud and false claims against the government.)

Money is not the only motivator of reporting fraud. When others see successful prosecutions, it encourages others with integrity and a desire for justice to report abuse. Their bold actions expose greed, while protecting others from fraud and initiating positive change. If you would like to report fraud, check out this list provided by the Department of Justice to reach the appropriate investigative agency.

Today’s “Fraud of the Day” is based on a Department of Justice press release entitled, Kentucky Otolaryngologist Pays $2.79 Million to Resolve False Claims Allegations,” released on February 6, 2018.

LOUISVILLE, Ky. – United States Attorney Russell M. Coleman and the United States Department of Labor announced a $2,791,758 settlement with ear, nose and throat doctor Phillip B. Klapper, M.D., Patricia Klapper, and Phillip B. Klapper, P.S.C. (collectively, “Klapper”) to resolve claims that Klapper, who practiced in Murray, Kentucky, improperly billed a federal healthcare program for audiological services and hearing aids.

“Pursuing healthcare fraud is a priority of this Office and of the Department of Justice.  We will continue to work with the Department of Labor and with other governmental agencies to ensure that fraudulent claims are investigated and those responsible are required to pay,” stated United States Attorney Russell M. Coleman.  “Medical providers who overbill federal healthcare programs defraud the taxpayers and drive up the cost of healthcare for us all.  Recovering taxpayer dollars lost to fraud helps keep strong those critical public healthcare programs so many people depend on,” said Coleman.

Previous articleExamining the Examiners
Next articleSinging the Jail House Blues

Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.