House must act on whistleblower bill to protect ‘insiders’ who report Russian money laundering 

After two years of extensive debate and advocacy,  the United States Senate, during the lame duck session, unanimously passed the bipartisan Anti-Money Laundering (AML) Whistleblower Improvement Act (S. 3316). The bill is now at the House, waiting final approval.

Why did the Senate take time to act on this bill during the ultra-busy lame duck session? The answer resides in Russia. The Senate bill targets Russian oligarchs who laundered billions of dollars into Western banks. For the first time whistleblowers who know where that money is stashed will be incentivized to report those assets to the departments of Justice and Treasury. Potential whistleblowers working as bankers, financial advisors, or real estate agents, know where every penny of this ill-gotten wealth is hidden.  

But that is just the beginning. If passed, for the first time ever there will be a whistleblower law identical to the highly successful Dodd-Frank Act covering whistleblowers worldwide who expose sanctions busting and money laundering. The bill targets anyone who is violating U.S. sanctions against Russia. Whistleblowers will be empowered to report anyone who is secretly providing Russia with weapons, technology, or money. It is arming whistleblowers with the tools they need to help Ukraine and stop Russian corruption and aggression.   

Senate bill 3316 contains all of the best features of the Dodd-Frank Act, features that have been praised by both Democratic and Republican appointed SEC chairs, and the director of the SEC’s Enforcement Division. It permits anonymous and confidential reporting, which is obviously most important to anyone reporting Russian crimes or informing the Justice Department as to where the oligarch billions are hidden. It incentivizes whistleblowers to report with a reward structure identical to Dodd-Frank. If the whistleblower voluntarily provides original information that is used to successful prosecute the criminals, the whistleblower can obtain a reward of between 10-30 percent of the money actually obtained from the crooks. If the whistleblower provides the key to detecting and prosecuting the frauds, only then can a reward be paid.  

No taxpayer money is ever used. The oligarchs and those trying to bust sanctions have to pay the whistleblowers for the service. This is why the bill has been positively scored by the Congressional Budget Office. It’s a money maker, using the fines paid by the criminals to pay whistleblowers and the victims of Russian corruption and aggression.  

The future of the bill now rests in the House of Representatives. The House Financial Services Committee unanimously voted to approve this law, known is the House as H.R. 7195. The bill could be voted on immediately under the House’s “suspension” calendar. There is just one last procedural step needed to bring the bill up for a vote. House Appropriations Committee Chairwoman Rosa DeLauro (D-Conn.), must sign-off on using the House-version of unanimous consent to approve the bill. Whistleblower advocates, such as the National Whistleblower Center, Whistleblower Network News, Taxpayers Against Fraud, Transparency International, USA, the Government Accountability Project, and the Project on Government Oversight have all endorsed the bill. There is no public opposition. So why the delay? 

Whether or not whistleblowers will be able to safety report Russian oligarchs and sanctions-busting is now in the hands of the House of Representatives. House parliamentary procedures may scuttle the bill. If so, the real losers will be those in Russia fighting corruption, those in Ukraine who are the victims of Russian corruption and sanctions-busting, and every whistleblower with information about these crimes.   

It is simply unreasonable to expect that whistleblowers will risk their safety, jobs, and careers to report despicable criminals if they do not have strong confidentiality protections and the ability to obtain some compensation given the risks they face. The House must decide who is getting a Christmas gift — the Russian oligarchs who desperately want to continue to hide their billions, or the whistleblowers who are willing to risk it all to serve the public interest. We will know when the lame duck session comes to an end.

Stephen M. Kohn is a founding partner at the whistleblower law firm of Kohn, Kohn and Colapinto and the Chairman of the Board of the National Whistleblower Center.