CHARLES TOWN – Delegate Stephen Skinner admits a whistleblower protection bill he’s co-sponsoring does spell bad news for some businesses in the state.
[cleeng_content id="664538513" description="Read it now!" price="0.49" t="article"]“This is a bad bill for any corporation who is ripping off the government,” the Democrat explained. “If you are a government contractor, whether you are laying fiber-optic line or building a road, and you are defrauding the government, you should fight this bill to the end.”
The West Virginia Chamber of Commerce last week sent out a letter with 15 objections to House Bill 4001, the “False Claims Act.”
Steve Roberts, president of the chamber, argued the bill would encourage frivolous lawsuits. “West Virginia does not have a good reputation in terms of being a place where we always have fair trials,” he said.
Small businesses would be hit particularly hard, Roberts said. “This is a bill that would expand the opportunity for lawsuits, chiefly against small businesses, the people who are most at risk because most small businesses who are trying to do business with the state or one of the universities, for example, do not have lawyers on staff to review everything that comes out the door,” he said.
Skinner contends the chamber is focused on big, out-of-state interests.
“This bill is targeted at companies that are ripping off the government, large or small,” Skinner said. “I think that [the chamber is] concerned that some of the provisions of this bill would affect some of the fraud that has gone on throughout the last couple of years relating to Routergate and the stimulus money, and they don’t want this to be retroactive.”
Early last year, a state audit concluded West Virginia wasted millions in federal grant money when it purchased 1,164 Cisco routers for $24 million in 2010.
The West Virginia Legislative Auditor found the state used a “legally unauthorized purchasing process” when awarding the router contract, paid for with federal stimulus funds, to Cisco. The auditor also found Cisco “showed a wanton indifference to the interests of the public” in recommending the investment in its model 3945 branch routers, the majority of which far exceeded the needs of the state agencies using them, the report stated.
Skinner argues the bill addresses a specific gap in fraud prevention statutes.
“This is a whistleblower bill to empower whistleblowers,” he said. “[Now] if a whistleblower comes forward now, they lose their job. There is plenty of fraud that gets discovered with these cases.
“The federal government has recovered $20 billion since 1986.”
Roberts argued the state’s existing fraud laws are sufficient to prevent fraud in government contracts. “West Virginia law has many deterrents to committing fraud,” he said.
Delegate Paul Espinosa, a Charles Town Republican, agrees that current laws are sufficient. He called the bill “political posturing” and “a windfall for the sue-and-settle industry at the expense of business.”
“I really see no suggestion that the current statutes and regulations have been ineffective,” he said.
The bill would allow workers in a company that gets government contracts to file a sealed lawsuit against their employer if they believe the company is defrauding the state.
After the suit is filed, the attorney general would have 60 days to decide whether to take up the case on behalf of the state.
The whistleblower would be given protection against being fired in retaliation for filing the suit, once it is unsealed. If the suit succeeded, the whistleblower would get a portion of the settlement against the company.