Do you know about fraud being committed in the Cash for Clunkers program? If so, you might be able to blow the whistle on the fraud and receive compensation.

The federal government’s Car Allowance Rebate System, better known as “Cash for Clunkers,” has been wildly popular. Car dealers have requested $3 billion in rebates through the program in just a few months. Car dealers must follow the federal government’s rules to get the rebates. Those rules include:

- The clunker being traded in must be less than 25 years old, have a combined EPA mileage rating of less than 18 miles per gallon, be in working condition, and have been insured and registered to the same owner for one full year.

- If the newly purchased vehicle is a car, the car must get at least 4 miles per gallon better mileage than the clunker. If the new car exceeds the clunker’s mileage by 4-9 miles per gallon, the clunker is entitled to $3,500 in trade-in value. If the new car exceeds the clunker’s mileage by 10 miles per gallon or more, then the clunker is entitled to $4,500 in trade-in value.

- If the newly purchased vehicle is an SUV or small truck, the SUV or small truck must get at least 2 miles per gallon better mileage than the clunker. A new SUV or small truck that achieves 2-4 miles per gallon more than the clunker allows a $3,500 trade-in value for the clunker, while a gain of 5 miles per gallon or more allows a $4,500 trade-in value.

- If both the newly purchased vehicle and the clunker are large trucks, the newly purchased large truck must get at least 1 mile per gallon better mileage than the clunker for the clunker to receive $3,500 in trade-in value, and 2 miles per gallon or more for $4,500 in trade-in value.

Also, dealers are only allowed to request rebates on trade-in values they’ve already provided to customers. In other words, a dealer cannot request a rebate before selling a car to the customer at a discount. Finally, dealers cannot demand a higher rebate from the government than they provide the customer. For example, it would be improper for a dealer to receive a $4,500 rebate even though it only provided a $3,500 trade-in value to the customer.

If you know of a car dealer or anyone else who lied to the government in order to get a Cash for Clunkers rebate, you can be a whistleblower by telling the government about it. As a whistleblower, the federal False Claims Act lets you keep a reward of up to thirty percent of the money that the government recovers.

The lawyers at Loevy & Loevy have substantial experience pursuing False Claims Act cases on behalf of whistleblowers. Please contact us at whistleblower@loevy.com. or 1-866-914-4221 to talk about how you can blow the whistle, help the government, and collect a reward.