Apparently, someone in a position of authority in the United Kingdom recently read Michelle Jones’ coverage of the record-breaking $14 million whistle blower payment here at ValueWalk and determined that their friends on the other side of the pond might just be on to something.
The British government is considering creating a reward system, similar to ones in the United States, to encourage whistle-blowers to come forward to root out fraud and other white-collar crime.
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The United States allows whistle-blowers to profit from penalties
The UK Home Office, or former overlords, said this week that it would be taking a look at the “qui tam” provisions that the United States uses to allow whistle-blowers to profit from penalties levied against their former employers when they assist prosecutors and regulators to investigate fraud.
Britain’s government will “consider the case for incentivizing whistle-blowing, including the provision of financial incentives, to support whistle-blowing in cases of fraud, bribery and corruption,” the Home Office said as part of a document announcing the new National Crime Agency in Britain.
The N.C.A amounts to the equivalent of the United States’ Federal Bureau of Investigation (FBI) and, though in its infancy, went live last week.
The Home Office, which overseas immigration, crime policy and counter-terrorism operations in Britain, did not give a timetable for when any decision would be made.
The investigation of white-collar crime can be all sorts of difficult to uncover without the help of whistle-blowers and cooperating witnesses, as financial firms are usually a tight-lipped group whose employees enjoy handsome salaries.
Using the False Claims Act—enacted to combat fraud by defense contractors following the United States’ civil war—whistle-blowers may anonymously file lawsuits on behalf of the government. Occasionally, the Justice Department then steps in to try the case, and in the case of financial penalties, then distributes a portion of the money to the whistle-blower who brought the case to the government’s attention.
The SEC established its own whistle-blower office
Since 1986, the Justice Department’s civil fraud section has recovered more than $20 billion in settlements and judgments, including whistle-blower actions. The SEC established its own whistle-blower office following the the financial industry reform bill (Dodd-Frank Act) passed into law in 2011.
Under the S.E.C.’s program, whistle-blowers who supply high-quality information that results in sanctions exceeding $1 million can receive rewards representing up to 30 percent of those sanctions.
Last week, SEC awarded a record $14 million dollars to an anonymous whistle-blower who helped them recover a large amount of investors lost money.
“Our whistle-blower program already has had a big impact on our investigations by providing us with high quality, meaningful tips,” the S.E.C. chairwoman, Mary Jo White said after the record payout was announced.