Up Close: Get rich quick by turning in the boss

11:28 AM CST on Tuesday, February 15, 2005

By Dave Fehling / 11 News

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HOUSTON -- You've heard how you can get thousands of dollars for those Crime Stoppers tips, but how would you like to make millions for turning in your boss?

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11 News reporter Dave Fehling has uncovered how middle-class Houston workers stand to become millionaires if their companies are as bad as they say are.

We can't tell you their names.

"I first thought it must be an error or oversight."

We can't show you their faces.

Reporter: "And you felt threatened?"

Whistleblower: "Yes, and I still do."

And we sure can't tell you where they work.

Reporter: "So the supervisors and other people above you kept telling you its OK, just go do this?"

Whistleblower: "Right."

Reporter: "And you thought you were ripping off the federal government?"

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Whistleblower: "There's no doubt about that."

They're called whistleblowers. People who say they caught their companies ripping off Uncle Sam. But instead of keeping quiet, they decided to turn their bosses in. And in the process, the whistleblowers might become millionaires.

James Devage of San Antonio is one of them. "I've always had problems with my back," he said.\

As a patient of HealthSouth, he blew the whistle on the rehab-hospital giant for overcharging Medicare for his physical therapy.

"I said: 'Somebody has to stop this sort of thing,'" Davage explained.

Glenn Grossenbacher is his lawyer.

"It was pretty clear what the fraud was," Grossenbacher said. "There was multiple, excessive billings being billed."

HealthSouth eventually agreed to pay the government $325 million of which James Devage will get $8 million.

He said he just wanted to do the right thing -- not get rich.

"Whatever I get, I'm gonna sort of spread it around," Davage said.

But using money to motivate people is a key feature of the Federal "False Claims Act" which gives whistleblowers a share of what the government recovers.

Houston attorney Mitch Kreindler.

"Historically the whistleblower receives about 17 or 18 percent of what the government recovers," explained Houston attorney Mitch Kreindler.

But before you get any ideas, listen to what some whistleblowers are going through right now.

This man still works at a major health care institution in Houston which he alleges has been defrauding the Medicare program.

Reporter: "How much money are we talking about?"

Whistleblower: "It's clearly in the tens of millions of dollars."

If the case holds together, he could get a cut. But if it falls apart, he could find himself out of job and blacklisted as a troublemaker.

Whistleblower: "Well, if it all goes south, that's exactly what's going to happen. I don't think there's any doubt about that.:

Reporter: "So you feel you're taking a financial risk?"

Whistleblower: "There's an enormous risk."

"It ws terrible, terrible stress," said another whistleblower. He's a scientist who worked for a Houston-area company that got federal money supposedly to do research for defense agencies and NASA.

Reporter: "Was there any legitimate business being done or was it almost all fraud?"

Whistleblower: "Almost all fraud."

After he decided to blow the whistle, federal investigators had him wear a wire and sneak out copies of documents.

Whistleblower: "Just to get up every morning and wire yourself up and go to work and do this and be peppered for questions: the agents would say we want you to ferret out this information. And, just, very stressful."

It's stressful and there's no guarantee it will make a case.

"I've been involved in litigation where the whistleblowers case... was not what they thought it was," said Mark Temple, who defends employers sued by whistleblowers. "You're having people, perhaps an opportunistic type of individuals, looking at this has potential winning of the lottery so to speak."

But for those with solid cases, whistleblowing is potentially a way to get rich while saving Uncle Sam millions.