The Department of Justice launched a new initiative to crack down on corporate crime: the Corporate Whistleblower Awards Program. Under this program, whistleblowers can now submit information to DoJ’s Criminal Division about certain types of corporate crime such as bribery and fraud.
The program offers monetary awards to those provide original information relating to financial crimes, bribery or healthcare fraud. If such information results in a forfeiture greater than $1 million, the whistleblower will be entitled to a financial award granted that the whistleblower.
“With this program we’re doubling down on a proven strategy to ferret out criminal activity that might otherwise go unreported,” said Deputy Attorney General Lisa Monaco. “Law enforcement has long offered rewards to coax tipsters to report crimes — from the “Wanted” posters of the Old West to the reforms in Dodd-Frank that created whistleblower programs at the SEC and the CFTC. Those agencies alone have received thousands of tips, paid out many hundreds of millions of dollars, and disgorged billions in ill-gotten gains from corporate bad actors.”
As outlined in the program’s guidance document, there are multiple criteria to meet in order to qualify for such an award. The whistleblower’s disclosure must be voluntary, the information must be original, the submission must be truthful and complete, including everything the individual knows about the conduct at issue and the individual must cooperate with the DOJ in the investigation, including testifying as required.
Individuals that meet these requirements will be eligible for an award, calculated based on the total proceeds forfeited. Eligible whistleblowers may receive up to 30% of the net proceeds forfeited to the DoJ For the first $100 million in net proceeds. Whistleblowers are eligible to receive up to 5% of any forfeiture between $100 and $500 million. Ultimately, this system sets a maximum award at $50 million.
In determining how much to give as an award the DoJ will consider multiple factors. These factors include the significance of the information; assistance provided by the whistleblower; participation by the whistleblower in the company’s internal compliance systems; any delay or interference in reporting; and if the individual was occupying an oversight role at the company.
The Program Faces Criticism for Implementing a Maximum Award Limit
Although this system has received praise from many of its observers, some have criticized it for its award cap. “Whistleblowers take enormous risks stepping forward, particularly in reporting the kind of wrongdoing targeted by DOJ’s new program,” said Erika Kelton, a partner at whistleblower law firm Phillips & Cohen. “By limiting the amount of an award, individuals may choose to stay silent, particularly because the larger recovery may also increase the risks.”
A Justice Department official noted that the $50 million maximum payment was established considering the history of SEC whistleblower awards, where most have been $50 million or less. According to agency data, the SEC has issued only three awards exceeding $50 million since the whistleblower program’s inception in 2011.
To file a claim for a whistleblower award, an individual must file a claim form located on the DoJ’ website. In order to be considered for an award all claim forms and required attachments must be received by the Department within 90 days of its publications of the successful forfeiture. 
Jacob Horowitz is a contributing editor at Compliance Chief 360°