The new DOJ pilot program is yet another tool in the U.S. government’s toolkit to help weed out white-collar crime: the SEC, CFTC and IRS all have longstanding whistleblower programs, and FinCEN more recently was mandated to establish a whistleblower program under the AML Act of 2020. The DOJ has other existing programs, such as the False Claims Act/Qui Tam program, that account for whistleblowers for certain laws, and on a parallel path, recently announced a separate pilot program providing certain executives non-prosecution agreements for voluntarily self-reporting criminal conduct.

Each program focuses on different laws, regulations and/or industries. Established whistleblower programs like the ones at the SEC, CFTC and IRS (and more recently, FinCEN) have paid billions of dollars in whistleblower rewards for tips that have led to enforcement actions. In 2023, the SEC issued its largest-ever whistleblower award of $279 million. The SEC cited that the award symbolized the “tremendous success” of its program.

The DOJ’s pilot program will increase the likelihood of whistleblowers coming forward and expand coverage to include nonpublic companies. The incentivization for whistleblowers to report wrongdoing as early as possible adds exposure for organizations that do not have effective programs to identify, investigate, remediate and report potential misconduct in a timely manner.

Read more in Corporate Compliance Insights about how, in light of this new program, organizations should test and enhance compliance and self-reporting programs to avoid becoming the next poster child.

If you have any questions or would like to find out more about this topic please reach out to Chris Hoyle.

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