On August 1, 2024, the United States Department of Justice’s (DOJ) Criminal Division announced the details of its much-anticipated Corporate Whistleblower Awards Pilot Program. This program is designed to incentivize whistleblowers with knowledge of corporate wrongdoing to come forward and share that knowledge with DOJ. It specifically allows whistleblowers to earn potentially sizable awards when the information they provide leads to DOJ enforcement action with criminal or civil forfeiture exceeding $1,000,000 in net proceeds.

The program is focused on obtaining information about money laundering, bribery, and healthcare fraud and, as of August 1, it is open for business.

To be eligible for a reward, the information provided must be “original” and voluntarily given, as explained further below. There are other eligibility requirements that tend to mimic those that have existed under the U.S. Securities and Exchange Commission’s and U.S. Commodity Futures Trading Commission’s award programs, established as part of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act. Pilot Program awardees must not have been involved in the misconduct at issue and must not have obtained the information through their work as a compliance officer or internal auditor of a company.

Attorney General Lisa Monaco commented that existing SEC, CFTC, and IRS award programs do not address the “full range of corporate and financial misconduct that the Justice Department prosecutes,” making this new program necessary to “ferret out criminal activity that might otherwise go unreported.”

Eligibility for award specifics.

1. Original Information. The reporting individual must disclose original information, meaning non-public information not previously known to the Criminal Division or to any component of the DOJ, and the information provided must relate to at least one of the following (with certain carveouts applying)
   1. Violations of financial institutions, such as money laundering, violations of anti-money laundering compliance, and non-compliance of financial institution regulators;
   2. Violations related to foreign corruption and misconduct by companies, including violations of the Foreign Corrupt Practices Act, the Foreign Extortion Prevention Act, and money laundering statutes;
   3. Domestic corruption committed by companies that include violations of bribery and kickback statutes; and
   4. Violations of law related to health care fraud against health care programs, investors, patients, and non-government entities in the health care industry.
2. Voluntary Disclosure. The disclosure must be voluntary, meaning it is made (1) before any request, inquiry, or demand is directed at an individual by the DOJ or other government agencies; (2) where the individual has no preexisting obligation to report the information to the DOJ or other government agencies; and (3) in the absence of any government investigation or threat of imminent disclosure to the government or the public.
3. Truthful and Complete Disclosure. The disclosure must be truthful and complete, including all information known to the individual about any misconduct in which they have participated or have knowledge.
4. Full Cooperation. The reporting individual must agree to fully cooperate with and be willing and able to provide substantial assistance to the DOJ, which may include truthful and complete testimony before a grand jury, at trial, or other court proceeding; producing relevant documents or records; and working proactively under the direction and control of federal law enforcement.

Amount of award specifics.

If the whistleblower’s information results in a successful prosecution that leads to a final criminal or civil forfeiture of over $1,000,000, the whistleblower may be entitled to a percentage of forfeited assets. Whistleblowers can receive up to 30% of the first $100 million in successfully seized assets and up to 5% of seized assets between $100 million and $500 million. In determining the award, DOJ will consider the significance of the information, the assistance provided by the whistleblower, whether the whistleblower participated in any internal compliance systems, and the timeliness of the disclosure. Additional guidance on the pilot program can be found here: dl (justice.gov)

The Department of Justice continues to demonstrate its commitment to investigating and prosecuting corporate misconduct by establishing programs and incentives that encourage the disclosure of crimes committed by corporations and their employees. Through this Pilot Program, DOJ is signaling the integral role whistleblowers play in corporate prosecutions and its commitment to incentivize cooperation efforts to combat criminal misconduct and uphold corporate integrity.