Understanding the Anti-Money Laundering Whistleblower Improvement Act
- posted: Aug. 03, 2023
- Graft and Corruption, Fraud
In December 2022, Congress presented the omnibus budget to President Biden, including the Anti-Money Laundering Whistleblower Improvement Act. This Act amends the Anti-Money Laundering Act to be more like other federal whistleblower programs. It was signed into law six days after it was presented.
This Act is likely to help the federal government recover millions, if not billions, through sanctions—although it is not without one key flaw.
How the Act helps Anti-Money Laundering Act enforcement
The Anti-Money Laundering Act (AMLA) initially created a whistleblower program for anti-money laundering enforcement. The Act protected whistleblowers and offered monetary incentives to voluntary whistleblowers. Unlike similar programs at the SEC and other agencies, the AMLA didn’t guarantee a minimum award for successful tips.
The AMLA also had issues with who could qualify as whistleblowers under the law. For instance, corporate auditors and compliance professionals did not qualify for protections. The Improvement Act helps make up for these issues. First, it guarantees a minimum whistleblower award for information leading to sanctions over $1 million. These funds come from the Financial Integrity Fund, rather than relying on taxpayer money. Finally, the Act removed qualification restrictions so compliance and auditing professionals can make reports without risking their livelihood. In fact, whistleblowers are not required to be a U.S. citizen or resident. This allows foreign nationals to report violations and potentially claim rewards.
Overall, these improvements strengthen the Act and enables whistleblowers to come forward with violations. However, there’s at least one remaining issue: employees of credit unions and banks cannot receive protection from retaliation or restitution. Instead, these employees have weaker protections under “the older and significantly weaker Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA).” This disincentivizes bank employees from speaking up about violations.
If you’ve noticed money laundering violations at your employment, an experienced whistleblower attorney at Kardell Law Group can help. Call today for a consultation.
