Behn & Wyetzner, Chartered, a Chicago law firm specializing in the representation of whistleblowers, is pleased to announce one of the largest settlements in Illinois state court under the Illinois False Claims Act.

The lawsuit was filed by Edelweiss Fund, LLC and its principal Johan Rosenberg, on behalf of the State of Illinois in the Circuit Court of Cook County, Illinois. Mr. Rosenberg is a municipal adviser with decades of experience in the municipal bond market. The defendants are some of the largest banks in the nation and include subsidiaries of JPMorgan, Bank of America, Citigroup, Barclays, Morgan Stanley, BMO, Fifth Third, and William Blair. The case is captioned State of Illinois, ex rel. Edelweiss Fund, LLC v. JPMorgan Chase & Co. et al. (Case No. 2017 L 289).

The lawsuit against the banks alleged fraud and collusion in the municipal bond market.

“The defendants were hired—and paid tens of millions of dollars—so that big cities and small towns alike could obtain financing at the lowest interest rates available in the market,” explains Dan Hergott, one of the plaintiff’s attorneys and a partner at Behn & Wyetzner. “The lower the rate, the less municipalities—and by extension taxpayers—pay to finance public projects.”

Edelweiss alleges that the defendants colluded and manipulated the municipal bond market for their own benefit, “causing government entities to pay inflated interest payments and fees for services that were not performed as promised,” says Mr. Hergott.

Under the settlement, the defendants agree to pay $70 million to settle allegations that they violated the Illinois False Claims Act. Defendants deny Edelweiss’ allegations and any wrongdoing.

“If it were not for Mr. Rosenberg’s courage and tenacity bringing this case forward, there would be no settlement today,” says Mr. Hergott. “The Illinois Attorney General’s Office investigated Edelweiss’ allegations but did not intervene in the case until a settlement was reached in principle. This means that Edelweiss and its legal team prosecuted the case against the banks on behalf of the State of Illinois.”

Edelweiss is also pursuing False Claims Act cases on behalf of government entities in New York, California, and New Jersey in separate state court actions.

Edelweiss is represented by Behn & Wyetzner, Chtd., Constantine Cannon LLP, McKool Smith P.C., Schneider Wallace Cottrell Konecky LLP, the Whistleblower Law Collaborative LLC, Howard Law, LLC, Steyer Lowenthal Boodrookas Alvarez & Smith LLP, DiCello Levitt LLP, and Stone and Magnanini LLP.

The False Claims Act and Behn & Wyetzner

The Illinois False Claims Act is modeled on the federal False Claims Act, which was enacted during the Civil War to ensure Union Army contractors submitted truthful claims for payment to the Unites States government. “When companies take public funds, they take on a heightened obligation to do the right thing,” says Mr. Hergott. Under the False Claims Act, whistleblowers can file a complaint on behalf of the government and receive a percentage of the government’s recovery.

The attorneys at Behn & Wyetzner have dedicated their careers to prosecuting fraud, protecting employees’ rights, and zealously representing whistleblowers under the False Claims Act. Further details about Behn & Wyetzner and the False Claims Act can be found at www.BehnWyetzner.com

For additional information regarding this settlement, please contact Dan Hergott at (312) 629-0000 or email: dhergott@behnwyetzner.com

Behn & Wyetner, Chtd. co-founder and whistleblower lawyer Michael I. Behn recently spoke at the annual training conference for the National Association of Medicaid Fraud Control Units (NAMFCU). The NAMFCU brings state prosecutors and investigators together from throughout the country to coordinate efforts to investigate and prosecute fraud in the Medicaid program. Medicaid provides healthcare to persons most in need and is funded by the states and federal government. Behn shared his experience effectively prosecuting Medicaid fraud by teaming whistleblowers and their attorneys with state prosecutors. Read Moreabout Attorney Behn Spotlights Whistleblowers’ Contributions at National Meeting of Medicaid Fraud Prosecutors

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For more information, check out the video below and visit Taxpayers Against Fraud.

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