Below is an excerpt of a Robinson+Cole legal update co-authored by Government Enforcement and White-Collar Defense Team co-chair Seth Orkand and member David Carney.
On March 7, 2024, Deputy Attorney General (DAG) Lisa Monaco announced the contours of a new Department of Justice (DOJ) pilot program (Pilot) offering financial incentives to individual whistleblowers who report certain criminal conduct to the DOJ. This significant announcement came in a speech that emphasized individual accountability for corporate conduct, more significant sanctions for recidivist corporations, expansion of credit for voluntary self-disclosures (VSDs), and a focus on prosecution of misconduct aided by artificial intelligence. (Acting Assistant Attorney General (AAG) Nicole M. Argentieri expanded on DAG Monaco’s comments on March 8, 2024.) As with corporate VSDs, after satisfying other prerequisites, the Pilot—designed to formalize the DOJ’s previously ad hoc approach with something more akin to the whistleblower compensation programs arising from the Dodd-Frank Act—rewards only the first reporter of misconduct, further setting the table for a race to the DOJ. As DAG Monaco said, “When everyone needs to be first in the door, no one wants to be second.”
The Pilot springs from the impact of extant programs, such as the hundreds of millions of dollars in rewards associated with billions of dollars in disgorgement under a similar Securities and Exchange Commission (SEC) program. DAG Monaco highlighted the Dodd-Frank whistleblower programs at the SEC and the Commodity Futures Trading Commission, similar programs at the Internal Revenue Services and the Financial Crimes Enforcement Network, and qui tam actions. However she noted that each of these has limitations, resulting in “a patchwork quilt that doesn’t cover the whole bed.” The DOJ will cover the rest of the bed with a program that “address[es] the full range of corporate and financial misconduct that the Department prosecutes.” Read more.