A new program aims to crack down on white-collar crime by offering rewards to corporate insiders who provide useful tips.
By David Nakamura, The Washington PostDeputy Attorney General Lisa Monaco speaks in April 2023 in the Great Hall at the Justice Department.
Under a Biden administration program the Justice Department plans to unveil within weeks, authorities will offer whistleblowers who provide tips that lead to successful prosecutions a percentage of the resulting penalties and fees - an amount that could total millions of dollars. And whistleblower advocates voiced concerns that prosecutors could become inundated with tips, making it difficult to determine which are most likely to lead to successful cases., which is limited to civil cases involving abuse of the U.S. government’s vast federal contracting system. Prosecutors and their tipsters last fiscal year were party to a record 543 settlements and judgments totaling $2.68 billion.
The Treasury Department, under its Financial Crimes Enforcement Network, is also establishing new whistleblower regulations, mandated by Congress, that will implement mandatory payments to tipsters. Justice officials said the initiative aims to fill enforcement gaps in areas where the other federal agencies lack legal jurisdiction. They cited foreign money-laundering operations that entangle American institutions, bribery of government employees and abuses of the U.S. financial system by non-publicly traded companies out of the SEC’s reach.
In December 2020, the U.S. affiliate of Vitol, an energy trading firm, agreed to pay $135 million to settle charges that it engaged in a scheme to bribe government officials in Brazil, Ecuador and Mexico for insider information to help win fuel oil contracts. Some lawyers cautioned, however, that the government’s willingness to reward tipsters could work against its push for corporations to more effectively investigate themselves. For example, they said, employees might choose to forgo bringing allegations to their company’s internal compliance department in favor of pursuing a whistleblower payout from federal authorities.
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