Sunday Read: NWC’s Top Policy Priorities in 2024
We are three weeks into 2024, and some ponder whether saying “happy new year” is still relevant. But there is no debate of the relevance of the National Whistleblower Center’s (NWC) mission — which remains constant in supporting whistleblowers in their efforts to expose and help prosecute corruption and other wrongdoing around the world.
Progress was made in 2023 following the passage and enactment of the Anti-Money Laundering Whistleblower Improvement Act (AML), but the NWC cannot rest its laurels on past successes. We remain dedicated to strengthening existing laws and support new legislation that further reflect the Center’s mission and values. For the benefit of consumers as well as employers and employees who seek to be on the right side of the law, it is tantamount that lawmakers and government agencies also act accordingly.
In this Sunday Read, National Whistleblower Center details the major action items and worthwhile causes we are championing in 2024. The policies listed below range from strengthening the AML and the False Claims Act (FCA) to compensating whistleblowers in a timely fashion. These are just some of the measures needed to ensure the effectiveness of the United States Strategy on Countering Corruption.
Critical NWC Campaigns
With the 118th Congress ending in less than a year — January 3, 2025 — Congress and the current-sitting executive officers must act on a number of pending whistleblower initiatives. The NWC believes in the following worthwhile causes, though they are subject to change.
Priority 1: Demand that the Department of Treasury Implements Rules for the Anti-Money Laundering Whistleblower Improvement Act.
The Treasury Department must enact regulations fully implementing the money laundering and sanctions whistleblower provisions of the AML. This law has been in effect since January 1, 2021, but Treasury has failed to implement the required regulations. Congress did its job, but Treasury has dropped the ball on approving the regulations necessary to ensure that the law is enforced. President Biden must demand that his Secretary of Treasury fully implement the anti-corruption strategy his White House approved as a critical national security measure.
Priority 2: Demand the Department of Justice accept anonymous and confidential whistleblower disclosures concerning violations of the Bank Secrecy Act, as required by law.
Since Jan. 1, 2021 the U.S. Department of Justice (DOJ) has been required to accept anonymous and confidential whistleblower disclosures concerning violations of the Bank Secrecy Act, including illegal money laundering and the use of cryptocurrency exchanges to facilitateviolations of law. In December 2022, this legal requirement was globally extended to whistleblowers who wish to report violations of sanctions covering Russia, Hamas, ISIS, and other covered entities. The DOJ has ignored this law, and has failed to adopt regulations permitting anonymous whistleblowing.
Priority 3: Demand that the SEC improve whistleblower regulations to ensure consistency with Congressional intent in the Dodd-Frank Act and with the mandate in the White House Anti-Corruption Strategy.
The Securities and Exchange Commission’s (SEC) Whistleblower Program has radically improvedin the past 15 years, most notably since its failure to respond to whistleblower disclosures regarding the fraudster Bernie Madoff. Certain regulations, including those that antedate the Madoff scandal exposed in 2008, continue to violate the statutory rights granted whistleblowers under the Dodd-Frank Act and strip otherwise qualified whistleblowers of their rights. The SEC can resolve these issues by issuing clarifying decisions and exemptions consistent with the plain meaning of the Dodd-Frank law and Congress’ clear intent.
Priority 4: Demand that the IRS compensate whistleblowers in a timely manner.
The Internal Revenue Service (IRS) and the SEC both fail to compensate whistleblowers in a timely manner. As reported by Whistleblower Network News in 2021, the IRS admits average delays of more than 10 years, causing untold hardship to whistleblowers, many of whom have lost their jobs and careers. Their only hope for economic survival is the compensation promised under law.
In response, Congress has introduced two laws to expedite paying legally required compensation to whistleblowers, the SEC Whistleblower Reform Act and 625, the IRS Whistleblower Reform Act. Both amendments have strong bipartisan support and should be/could be passed quickly.
Priority 5: Demand that Congress strengthen the False Claims Act.
The False Claims Act (FCA) whistleblower qui tam provision has proven to be the most effective law ever passed protecting the government from greedy contractors, fraud in Medicare and Medicaid, and from criminal procurement practices. More than $70 billion has been recovered by taxpayers directly from fraudsters, and countless billions have also been paid in criminal fines.
Two bipartisan amendments to the FCA are languishing in Congress:
- The Administrative False Claims Act, S. 659 has been unanimously passed by the Senate but is stalled in the House of Representatives. It is designed to prevent federal contractors from colluding with government officials when trying to justify their frauds.
- The FCA Amendment targeting collusion permits the federal government to administratively sanction contractors in smaller cases, where prosecutors rarely file charges in court. The amendment has strong bipartisan support, but awaits votes in Congress.
Priority 6: Demand that Congress pass the CFTC Fund Improvement Act.
The whistleblower reward law covering violations of the Commodity Exchange Act has proven incredibly successful. Multiple billions of dollars in sanctions were recovered from fraudsters who have manipulated markets and ripped off global consumers.
But these unprecedented whistleblower-triggered prosecutions have created an unintended challenge: Inadequate funds available to compensate whistleblowers as required under law. The CFTC Fund Improvement Act, S. 2500 is a bipartisan solution that should be immediately passed.
Priority 7: Demand that federal agencies respect, honor, and compensate whistleblowers.
In 2021 the White House, in conjunction with every major executive agency, approved The United States Strategy on Countering Corruption. Through this authoritative and non-partisan Anti-Corruption Strategy, the U.S. finally and formally recognized the key role whistleblowers play in detecting fraud and corruption.
However, one of the most unacceptable and unjustifiable hardships facing whistleblowers is the continued resistance to protecting whistleblowers in numerous (most) federal agencies. This is exemplified by the complete failure of agencies to use their discretionary powers to protect or compensate whistleblowers. Worse still, is the Justice Department’s penchant for prosecuting whistleblowers — even those who voluntarily report crimes pursuant to disclosure laws.
President Biden must take action and demand that all executive agencies use their discretionary authorities permitted under law to incentivize and protect whistleblowers consistent with his administration’s Anti-Corruption Strategy.
Comprehensive details of these campaigns can be found on the NWC page.
Action Needed Now
Many of the aforementioned initiatives already have strong bipartisan support. They are based on the plain meaning of laws passed by Congress, and are individually or collectively essential for the implementation of the U.S. Anti-Corruption Strategy.
These campaigns aim to strengthen the rights and protections of those who bravely come forward with information that impact taxpayers, consumers, government agencies and lawful individuals and organizations. Ultimately, whistleblower engagement can protect the physical and economic security of the public, which is why action is needed now.
Support NWC
The NWC is a 501(c)(3) non-profit and our awareness-building work is made possible with the support of our generous donors. Please consider donating $100 today to help us continue our important advocacy for whistleblowing and whistleblowers around the world. Donors of $100 or more will receive a copy of Rules for Whistleblowers: A Handbook for Doing What’s Right, written by NWC Chairman Stephen M. Kohn, Esq.
This story was written by Justin Smulison, a professional writer, podcaster, and event host based in New York.
