The DOJ just rolled out a Corporate Whistleblower Awards Pilot Program https://www.justice.gov/criminal/criminal-division-corporate-whistleblower-awards-pilot-program on August 1, 2024, that could lead to big payouts for anyone blowing the whistle on shady corporate dealings. This new 3-year initiative could reward you up to $50 million if you provide inside info that exposes corruption or financial crimes in certain sectors. To qualify, the tip has to be about four key areas: financial crimes, foreign or domestic corporate corruption, or health care fraud involving private health programs.
This program could impact workers in financial institutions (FIs) who are part of anti-money laundering (AML) and counter-financing of terrorism (CFT) compliance teams. The program’s details reveal a potential conflict with existing whistleblower protections under the Bank Secrecy Act (BSA), which was revamped by the Anti-Money Laundering Act (AML Act). We've talked about these issues extensively (you can read more here, here, and here).
Who Can Score the Reward?
To be eligible, you must be an individual (not a company) who provides written information to the DOJ about corporate crimes that result in at least $1 million in forfeitures. The tip must be voluntary—meaning you offered it up before being asked, with no obligation to do so, and with no ongoing investigation.
Also, to cash in, you can’t be involved in the crime you're reporting, and you have to tell the whole truth—no holding back info.
What Counts as “Original Info”?
You have to bring new information to the table—stuff that comes from your personal experience, not something already out in public. If the DOJ already knows about it, your info must add significant value.
This is especially relevant for AML/CFT compliance workers. The program says compliance workers usually can't qualify if the info they have is related to their job duties, like flagging suspicious activity or reporting violations. However, compliance folks can still be eligible if they believe reporting to the DOJ will prevent a serious crime like national security threats, violence, or major harm. And if you wait 120 days after reporting the info internally to your company's legal or compliance officers, you can still qualify for a reward.
Even though the program has some tricky rules for whistleblowers, companies need to take these complaints seriously. They have a tight window to report any misconduct once they get wind of it. Whether or not the whistleblower gets paid, their info can be a huge risk for the company.
What Kind of Crimes Are Covered?
Here’s the type of misconduct that can get you the bag:
Crimes by financial institutions, like money laundering, non-compliance with AML laws, or fraud.
Bribery and corruption by companies overseas, including violations of the Foreign Corrupt Practices Act (FCPA).
Bribery and kickbacks to public officials here at home.
Health care fraud, especially against private health care benefit programs.
How Much Can You Make?
The DOJ is offering up to 30% of the first $100 million in forfeited funds, and up to 5% of anything between $100 million and $500 million, with a cap of $50 million. But keep in mind, property owners and victims get paid first, so your reward will come from whatever’s left.
The DOJ will decide the payout based on factors like how important your info was, how much help you provided, and if you reported the issue through your company’s internal system first. If you made money from the crime, delayed reporting, or caused trouble for your company’s internal compliance, your reward could be reduced.
Unlike the AML Act, which focuses on fines, this new program is all about forfeiture—assets seized as a result of the crime. This is a big deal because many of the biggest AML enforcement actions have centered on forfeiture. For example, Danske Bank was hit with over $2 billion in forfeitures for failing on AML compliance. So, this new program could be more attractive for whistleblowers looking at AML/CFT-related cases.
How Does This Program Play With Other Whistleblower Programs?
If you're eligible for another government whistleblower program—like one from the SEC or IRS—you can't get paid under the Pilot Program for the same information. But the DOJ suggests reporting to both programs just to be safe, and they’ll decide if you qualify under this program.
What Should Companies Do?
The whole point of this new program is to motivate people to speak up about corporate crimes, either directly to the DOJ or internally to their company. If you report internally first, you might increase your payout, as long as you report to the DOJ within 120 days of telling your company. And if your company self-reports to the DOJ within that same time frame, they can avoid some punishment.
For companies, the pressure is on to beef up compliance programs and encourage internal reporting. They need to train their compliance teams to handle complaints fast and loop in legal counsel early. Doing this gives them the best chance to fix the problem and stay in the DOJ's good graces.
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