The Law Firm of Piacentile, Stefanowski & Malherbe LLP

House Committee Passes Bill to Strengthen AML Whistleblower Program

A bill originally introduced by Sen. Chuck Grassley in 2021— to revise the management of whistleblower inventive awards for individuals who provide original information relating to illegal monetary transactions, money laundering, or other financial crimes — has cleared the House Financial Services Committee. Specifically, this Bill establishes a minimum incentive award for whistleblowers of not less than 10 percent of the collected monetary sanctions. 

The bipartisan, bicameral proposal expands on the Anti-Money Laundering Whistleblower Program by adding support to whistleblowers who report violations of U.S. sanctions laws, creating a funding mechanism for the payment of whistleblower awards. There is now a guarantee that whistleblowers will be paid a minimum award. 

“The whistleblower programs I’ve helped create have seen roaring success, with the False Claims Act saving taxpayers $70 billion and the SEC whistleblower program saving over $4.8 billion. I’m optimistic that our new program encouraging individuals to come forward for suspected sanctions violations will be successful as well” Grassley said. 

Under the proposal, whistleblowers would receive 10-30 percent of the value of fines collected from successful enforcement actions. Making the anti-money laundering system on par with other very successful whistleblower programs. Repeated studies by the Government Accountability Office and the Securities and Exchange Commission Inspector General have established that these changes are known for successfully motivating whistleblowers to come forward. 

One of the differences from the existing system is that the bill appropriates no new funds while also ensuring that money is available when whistleblowers are approved to receive an award. This was accomplished by creating a $300 million fund from fines collected by the Department of Justice and Treasury. 

This bill was endorsed by many organizations like National Whistleblower Center, Taxpayers Against Fraud, the Government Accountability Project, the Project on Government Oversight, and Transparency International. 

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