U.S. Whistleblower Program Expands to Non-U.S. Citizens

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New Classes of Whistleblowers

In December 2022, the U.S. Congress included the Anti-Money Laundering Whistleblower Improvement Act (‘AMLIA’) as part of the Omnibus Budget for that year.1 The Act introduces new incentivization measures to encourage reporting information about the financial crimes of money laundering and sanctions evasion. The Act includes drastic new measures to expand enforcement against those committing financial crimes, violating sanctions, and money launderers operating in the United States financial system or abroad, chiefly by expanding the incentives for whistleblowers with knowledge of illicit conduct.

The most important update to these whistleblower laws is that non-U.S. citizens, corporate auditors and compliance professionals can qualify as whistleblowers eligible to receive significant financial compensation for their disclosures of financial misconduct that would not qualify for awards under other bounty programs. In general, anyone who has original-source, substantial and relevant knowledge of wrongdoings that are of interest to the United States can be a whistle-blower. The money laundering or financial crime at issue must have some connection to the U.S. However, the intensity of the territorial link/connection with the U.S. need not be strong. If U.S. financial systems or interests are affected in any way, the U.S. will likely find a sufficient nexus to allow enforcement.

The U.S.’ strong stance on this issue gets a lot of negative responses from foreign countries, which view the position as unreasonable. France, for example, has passed a blocking statute known as the Loi de Blocage2 to prevent its citizens from cooperating with the U.S. government as a direct result of what they considered as U.S. government overreach. From a Swiss point of view, there are few, but extremely relevant, norms that need to be considered when the potential whistleblower is on Swiss territory or the Swiss sovereignty is at stake. Aside from the EU Blocking Statute,3 The Neth-erlands has not (yet) implemented blocking statutes similar to the French or Swiss pertaining to whistleblowers.

Netherlands AML and Whistleblower Protection Act

The Netherlands Act on the Prevention of Money Laundering and Terrorist Financing (Wet ter voorkoming van witwassen en financieren van terrorisme; ‘AML’) requires that an organization has adequate procedures in place for reporting viola-tions of the AML. The Netherlands’ Whistleblower Protection Act is there to protect people reporting wrongdoings. Like the AML, the Whistleblower Protection Act stipulates that organizations should have an internal procedure in place for reporting suspected wrongdoings. In the Whistleblower Protection Act, the Central Bank of The Netherlands (De Nederlandse Bank) has been designated as the authority responsible for receiving and following up on a report of sus-pected wrongdoing at a financial institution including fraud, corruption, conflicts of interest and money laundering.

Conclusions

The AMLIA is a measure that will better enable the U.S. government to curb financial crimes that often go undetected and undeterred, and will encourage new groups of key individuals to come forward with knowledge of these abuses. These key individuals can also be non-U.S. citizens, e.g. working for a U.S. subsidiary in The Netherlands.
The novelty of the AMLIA means that the impact of this act for citizens and corporations based in The Netherlands is currently unknown. Reporting a criminal conduct under the AMLIA creates complexity given the interplay between the U.S. and Netherlands systems and the risks a potential whistleblower could face at home and abroad. We therefore encourage any potential whistleblower to seek the advice of experienced and competent U.S. and Netherlands counsels prior to contacting the U.S. authorities or making any statement. Likewise, AMLIA creates new potential exposure for organizations—both for underlying conduct reported by a whistleblower and potential retaliation or employment issues should the organization improperly handle a whistleblower complaint. If an organization suspects it could or may be subject to a whistleblower complaint, it should promptly advise management and counsel to ensure that the complaint is handled efficiently and in a manner that does not violate domestic or U.S. law. Organizations should also consider whether to proactively modify their existing compliance programs to account for this new exposure.


1 https://www.congress.gov/bill/117th-congress/senate-bill/3316/text
2 https://www.entreprises.gouv.fr/fr/securite-economique/la-loi-de-blocage-reforme-et-publication-d-guide
3 EU Regulation 2271/96