On November 30, Representatives Jan Schakowsky (D-IL) and Lori Trahan (D-MA) introduced the FTC Whistleblower Act of 2021. The bill aims to incentivize and protect whistleblowers who disclose violations of laws overseen by the Federal Trade Commission (FTC). Whistleblower advocates applaud the bill as a step towards protecting FTC whistleblowers but also raise concerns about the bill’s lack of a mandatory minimum for awards.
The FTC Whistleblower Act would establish a whistleblower reward program for FTC whistleblowers modeled off the highly successful SEC Whistleblower Program. The program would offer protections to whistleblowers who face retaliation for blowing the whistle to the FTC. Furthermore, FTC whistleblowers could qualify for awards of 10-30% of the funds collected by the government in connection with their disclosure.
However, the FTC Whistleblower Act differs from the Dodd-Frank Act, the law which established the SEC whistleblower program, in that it does not mandate the payment of whistleblower awards. It states that the FTC “may” pay an award instead of “shall” pay an award to a qualified whistleblower. This lack of a mandatory award troubles some whistleblower advocates who think it will undermine the program. Similar concerns have been raised about the recently established anti-money laundering whistleblower program.
“The introduction of the FTC whistleblower bill is very encouraging,” said Siri Nelson, Executive Director of the National Whistleblower Center (NWC). “But, without a mandatory minimum award this program is destined to fail. The FTC program is a good first step and with the right reward provisions it will make a huge difference for currently unprotected unrecognized whistleblowers in industries that impact all of our lives.”
The FTC is responsible for enforcement of 70 different laws; thus, the FTC Whistleblower Act aims to incentivize whistleblowers to make disclosures on a wide range of misconduct, including unlawful violations of consumer protection and antitrust laws and regulations.
“Time and time again, whistleblowers have proven key in uncovering information critical to protecting consumers,” said Representative Trahan. “As the Federal Trade Commission works to investigate harmful behavior by massive corporations, it’s important that the agency offers safeguards to protect and incentivize potential whistleblowers, as is standard with several other investigatory agencies. I’m proud to join with Chairwoman Schakowsky to introduce the FTC Whistleblower Act of 2021, which will enable the Commission to establish these essential standards and bolster its important work.”
“Whistleblowers risk their livelihoods to bring truth to light and help safeguard the public from corporate wrongdoing,” added Representative Schakowsky. “Recent events have again proven how indispensable whistleblowers are to our society, to democracy, and to American families. That is why today my colleague Representative Trahan and I take action to support whistleblowers. The FTC Whistleblower Act of 2021 will help the Commission to take bold action against wrongdoers by protecting whistleblowers from retaliation for their bravery and incentivizing the disclosure of unlawful activity that harms American consumers.”