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DOJ's Whistleblower Reward Program: A Comprehensive Analysis of Design and Impact

The Department of Justice (DOJ) is gearing up to introduce a whistleblower reward program, signaling a significant step in its efforts to combat corporate and financial misconduct. Deputy Attorney General Lisa Monaco revealed plans for the program, emphasizing its necessity in filling the gaps left by existing whistleblower initiatives like those of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), which she noted are limited in their jurisdictional scope.


DOJ's Whistleblower Reward Program: A Comprehensive Analysis of Design and Impact

Monaco outlined the DOJ's specific areas of interest for whistleblower disclosures, which include unearthing criminal abuses within the U.S. financial system, uncovering violations of the Foreign Corrupt Practices Act by non-issuers, and tackling cases of domestic corruption. The program is slated to kick off later this year and is expected to incorporate a monetary threshold similar to that of the SEC and CFTC, restricting rewards to cases with sanctions surpassing $1 million.

 

However, experts caution that the program's effectiveness will be contingent upon its design and execution. Mary Inman, a partner at Whistleblower Partners, emphasized that the program's success hinges on addressing core elements outlined by whistleblower law expert Stephen Kohn. Kohn advocates for the implementation of anonymous and confidential reporting channels to shield whistleblowers from potential retaliation. He also stresses the importance of establishing a dedicated whistleblower office within the DOJ to streamline the reporting process and ensure consistency in handling whistleblower disclosures.


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One contentious aspect of the program is the exclusion of whistleblowers involved in criminal activity, which some argue could discourage individuals with valuable information from coming forward. Inman contends that valuable insights often come from individuals who may not have a spotless record.

 

Kohn further advocates for mandatory awards falling within a specified percentage range, prompt processing of whistleblower cases, and robust protections for whistleblowers to incentivize disclosures. He suggests that whistleblowers should be accorded respect and even considered for positions on corporate boards or audit committees as a token of acknowledgment for their courage and ethical stance.

 

From a corporate compliance standpoint, experts stress the importance of fostering a culture where employees feel empowered to report internally without fear of reprisal. Jisha Dymond, chief ethics and compliance officer at OneTrust, underscores the need for companies to gauge employees' comfort levels in speaking up through surveys and questionnaires.

 

In conclusion, while the DOJ's whistleblower program holds promise in enhancing the government's ability to uncover and address corporate wrongdoing, its effectiveness will ultimately depend on its adherence to key principles outlined by experts in the field. Achieving a balance between the needs of whistleblowers and the imperatives of corporate compliance will be crucial in ensuring the program's success.

By fLEXI tEAM

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