On Thursday, December 29, President Biden signed the “Consolidated Appropriations Act, 2023,” a spending package for 2023. With this action, the Anti-Money Laundering (AML) Whistleblower Improvement Act has passed, and individuals blowing the whistle on money laundering and sanctions violations now have enhanced protections.
Congress passed the AML Whistleblower Improvement Act on December 23. The Act offers two reforms to the AML Whistleblower Program established in 2021 but undermined by legislative loopholes. The reforms are modeled off provisions of the Dodd-Frank Act, which established the highly successful SEC and CFTC whistleblower programs.
One of the Act’s provisions specifies that under the AML Whistleblower Program, qualified whistleblowers will receive awards of “not less than 10 percent” of the sanctions collected in the relevant enforcement action. Previously, there was no statutory minimum for AML whistleblower awards, meaning that awards are purely discretionary.
The Act also establishes a fund to pay AML whistleblower awards. Like the SEC’s whistleblower fund, it is entirely financed by sanctions collected in whistleblower-assisted cases. This means that whistleblower awards are not reliant on the Congressional appropriations process and do not cost taxpayers any money.
The Act also expands the reach of the AML Whistleblower Program to cover whistleblowers who disclose violations of U.S. sanctions such as those imposed in response to Russia’s invasion of Ukraine. Before Congress passed this law, no U.S. whistleblower law covered sanctions whistleblowing.
“This law is the most important transnational anti-corruption law ever passed. Russian oligarchs, drug dealers, terrorists, corrupt government officials, and tax evaders all engage in money laundering. It is how they hide their ill-gotten gains. This law creates the first effective mechanism to incentivize AML whistleblowers,” said leading whistleblower attorney Stephen M. Kohn of Kohn, Kohn & Colapinto. Kohn spoke about the incredible grassroots effort to pass the AML Whistleblower Improvement Act in a special edition of the “Whistleblower of the Week” podcast by FBI whistleblower Jane Turner.
The spending bill, H.R. 2617, contains “consolidated appropriations for the fiscal year ending September 30, 2023, and for providing emergency assistance for the situation in Ukraine, and for other purposes,” according to the White House.
Read more about the AML Whistleblower Improvement Act on WNN.
