U.S. Department of Justice announces new corporate whistleblower reward program

On March 7, 2024, at the American Bar Association’s National Institute on White Collar Crime, Deputy Attorney General Lisa O. Monaco announced that the Department of Justice (DOJ) would be implementing later this year a new program to provide whistleblowers monetary rewards for reporting criminal misconduct at public or private companies, noting DOJ will be particularly interested in reported violations of the Foreign Corrupt Practices Act (FCPA) and the recently enacted Foreign Extortion Prevention Act (FEPA).  

The soon-to-be-implemented program, for which Acting Assistant Attorney General, Criminal Division, Nicole Argentieri offered additional detail on March 8, is intended to replicate the success of existing whistleblower incentives, including those at the SEC, CFTC, IRS, and FinCEN.   The new program, however, will “fill gaps” and provide a direct channel for whistleblower reporting misconduct that wasn’t previously subject to a whistleblower reward program such as potential FCPA violations at private companies (including non-U.S. companies where FCPA jurisdiction can be established). 

According to Monaco, DOJ will be particularly interested in “foreign corruption cases outside of the jurisdiction of the SEC, including [FCPA] violations by non-issuers and violations of the recently enacted [FEPA]…”

DOJ has already instituted some “basic guardrails” for this new program, including:

• Compensation will be available only to individuals who provide truthful information the government was not previously aware of and who were not themselves involved in the criminal activity;
• A reward will only be provided after all victims of the reported misconduct have been properly compensated;
• An informant may receive a reward only where there was not an existing financial incentive to disclose, such as through a qui tam action or under another federal whistleblower program; and
• A reward will be available only where the monetary sanction imposed for the reported misconduct exceeds a specific threshold.

For further details and analysis regarding the new whistleblower program, as well as updates on efforts to incentivize the disclosure of corporate misconduct and other key takeaways from last week’s DOJ statements, please click here.

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