No Result
View All Result
SUBSCRIBE | NO FEES, NO PAYWALLS
MANAGE MY SUBSCRIPTION
NEWSLETTER
Corporate Compliance Insights
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Career Connection
  • Events
    • Calendar
    • Submit an Event
  • Library
    • Whitepapers & Reports
    • eBooks
    • CCI Press & Compliance Bookshelf
  • Podcasts
  • Videos
  • Subscribe
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Career Connection
  • Events
    • Calendar
    • Submit an Event
  • Library
    • Whitepapers & Reports
    • eBooks
    • CCI Press & Compliance Bookshelf
  • Podcasts
  • Videos
  • Subscribe
No Result
View All Result
Corporate Compliance Insights
Home Compliance

Whistleblowing: More Than Just Bounty Hunting?

by Wendy Wysong
March 24, 2017
in Compliance
man in suit holding red whistle

Australia’s Position on a Compensation Scheme

Australia’s stance on financial remuneration for whistleblowers could be changing. The nation recently launched a Parliamentary inquiry into the appropriate legal framework for whistleblowers. Currently Australia offers no financial compensation for whistleblowers; supporters feel a “bounty” system is inappropriate, but it could be a profitable business.

with co-authors Diana Chang and Dominique Yong

Amidst global efforts to provide safe paths for whistleblowers to report wrongdoing, Australia has launched a Parliamentary inquiry into the appropriate legal framework for whistleblowers in the public, private and not-for-profit sectors. One of the more controversial issues will be whether there should be financial compensation for reporting. Although whistleblowers in Australia presently receive no financial compensation, last year Australian sources provided the third-largest number of tips to the U.S. Securities and Exchange Commission (SEC), just behind those in Canada and the U.K.

If Australia allows a compensation scheme, there is no doubt it would be used. However, until Australian regulators are successful in advocating for higher penalties and consequent higher potential compensation for whistleblowers, the flow of tips from Australia to the United States is likely to continue given the currently much higher U.S. penalties and greater rewards for whistleblowers.

The U.S. System

The whistleblower reward system has its roots in the United States, where potential whistleblowers may be motivated by sizable awards in return for disclosure. The SEC has the power to award up to 30 percent of the money collected as a reward to whistleblowers who disclose information leading to an enforcement action (where the penalty exceeds US$1 million). Since the programme was established six years ago, it has awarded US$149 million to some 41 whistleblowers. Individuals can also bring claims on behalf of the government under the False Claims Act. These claims allow prosecuting individuals to recover a proportion of any resulting judicial reward, which can be highly lucrative. More than US$500 million was handed out by way of these types of awards in 2016 alone, compared with recoveries of more than US$4.7 million.

The U.K. Position

In the U.K., there are currently no legal provisions which provide for financial incentives to whistleblowers for regulatory enforcement matters. There is also no current indication that the U.K. will adopt a regulatory bounty system. In a Parliamentary report in July 2014, the Financial Conduct Authority and the Prudential Regulation Authority found there was “no empirical evidence to suggest that the U.S. system raises either the number or the quality of whistleblowing disclosures within financial services.”

Australian Position

Despite the flow of whistleblower tips to the United States, views vary as to whether Australia should move in that direction or remain in the U.K. camp. One submission to the inquiry took the stance that a so-called “bounty” system is inappropriate for the public sector given existing codes of conduct and legislation. Another thought that providing an additional incentive to come forward could counter the disincentive many whistleblowers face through retribution and bullying.

Ethical issues arise when considering possible financial remuneration for whistleblowers, particularly those who have participated in wrongdoing. On the one hand, such people should still be encouraged to report the wrongdoing notwithstanding their involvement, particularly because they will likely have the best information. The extent to which culpable whistleblowers could be eligible for financial rewards is up for debate. One approach would be for culpable whistleblowers to benefit from reduced or deferred sentences for their wrongdoing, depending on the usefulness of their reporting, but they would otherwise not receive a financial reward. Alternatively, they could be compensated for the loss of their reasonably expected income in cases where whistleblowing may affect their ability to continue their employment.

Another issue will be the involvement of litigation funders in whistleblowing cases, particularly if Australia introduces a system allowing individual claims similar to the U.S. False Claims Act. One litigation funder, which has already been very successful in the Australian market funding class actions, has recently announced an initiative offering assistance to potential U.S. whistleblowers. The creation of a financial compensation regime in Australia, depending on how it is structured and whether stronger penalties are introduced for white collar crime, could see further developments of this kind and the creation of a whole new market.

Whether Australia makes whistleblowing a profitable business remains to be seen. Current submissions to the Parliamentary inquiry, which closed in February 2017, are divided on this issue. Until the issue is resolved, given the demonstrated willingness of Australians to whistleblow, it appears to be a question of where and how much, not whether or when.


Tags: Whistleblowing
Previous Post

SEC Votes on Use of Inline XBRL

Next Post

New York DFS Finalized Cybersecurity Regulations Take Effect

Wendy Wysong

Wendy Wysong

Wendy L. Wysong is a partner at Steptoe & Johnson. She served previously as a litigation partner with Clifford Chance, offering clients advice and representation on compliance and enforcement under the Foreign Corrupt Practices Act, the Arms Export Control Act, International Traffic in Arms Regulations, Export Administration Regulations, and OFAC Economic Sanctions. She was appointed by the State Department as the ITAR Special Compliance Official for Xe Services (formerly Blackwater) in 2010. Wendy combines her experience as a former federal prosecutor with the United States Attorney for the District of Columbia for 16 years with her regulatory background as the former Deputy Assistant Secretary for Export Enforcement at the Bureau of Industry and Security, U.S. Department of Commerce. She managed its enforcement program and was involved in the development and implementation of foreign policy through export controls across the administration, including the Departments of Justice, State, Treasury and Homeland Security, as well as the intelligence community. Wendy received her law degree in 1984 from the University of Virginia School of Law, where she was a member of the University of Virginia Law Review.

Related Posts

call of duty activision

Activision Settlement Highlights Where Companies Often Go Wrong With Whistleblowers

by Katherine Krems
March 8, 2023

The SEC has long relied on whistleblowers to enforce securities law, often making it worth their while to the tune...

Syncing your ESG programme across the business: five tips for building ESG into your organisation

Syncing your ESG programme across the business: five tips for building ESG into your organisation

by Aarti Maharaj
February 9, 2023

In today's business landscape, there's a growing awareness of how ESG issues affect the bottom line. While companies are adopting...

hottest takes

The Hottest Compliance Takes of 2022

by Staff and Wire Reports
December 14, 2022

Nobody was canceled for anything they wrote for our pages in 2022 — at least that we know of. But...

NAVEX regional whistleblowing hotline benchmark report_f

Navex 2022 Regional Whistleblowing Hotline Benchmark Report

by Corporate Compliance Insights
November 9, 2022

Explore benchmark data and regional comparisons for Europe, APAC, North America and South America. Regional Benchmark Report 2022 Regional Whistleblowing...

Next Post
hooded figure behind laptop

New York DFS Finalized Cybersecurity Regulations Take Effect

Compliance Job Interview Q&A

Jump to a Topic

AML Anti-Bribery Anti-Corruption Artificial Intelligence (AI) Automation Banking Board of Directors Board Risk Oversight Business Continuity Planning California Consumer Privacy Act (CCPA) Code of Conduct Communications Management Corporate Culture COVID-19 Cryptocurrency Culture of Ethics Cybercrime Cyber Risk Data Analytics Data Breach Data Governance DOJ Download Due Diligence Enterprise Risk Management (ERM) ESG FCPA Enforcement Actions Financial Crime Financial Crimes Enforcement Network (FinCEN) GDPR HIPAA Know Your Customer (KYC) Machine Learning Monitoring RegTech Reputation Risk Risk Assessment SEC Social Media Risk Supply Chain Technology Third Party Risk Management Tone at the Top Training Whistleblowing
No Result
View All Result

Privacy Policy

Founded in 2010, CCI is the web’s premier global independent news source for compliance, ethics, risk and information security. 

Got a news tip? Get in touch. Want a weekly round-up in your inbox? Sign up for free. No subscription fees, no paywalls. 

Follow Us

Browse Topics:

  • CCI Press
  • Compliance
  • Compliance Podcasts
  • Cybersecurity
  • Data Privacy
  • eBooks Published by CCI
  • Ethics
  • FCPA
  • Featured
  • Financial Services
  • Fraud
  • Governance
  • GRC Vendor News
  • HR Compliance
  • Internal Audit
  • Leadership and Career
  • On Demand Webinars
  • Opinion
  • Resource Library
  • Risk
  • Uncategorized
  • Videos
  • Webinars
  • Well-Being
  • Whitepapers

© 2022 Corporate Compliance Insights

No Result
View All Result
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Career Connection
  • Events
    • Calendar
    • Submit an Event
  • Library
    • Whitepapers & Reports
    • eBooks
    • CCI Press & Compliance Bookshelf
  • Podcasts
  • Videos
  • Subscribe

© 2022 Corporate Compliance Insights

Welcome to CCI. This site uses cookies. Please click OK to accept. Privacy Policy
Cookie settingsACCEPT
Manage consent

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
CookieDurationDescription
cookielawinfo-checbox-analytics11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checbox-functional11 monthsThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checbox-others11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-necessary11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-performance11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy11 monthsThe cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytics
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Others
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
SAVE & ACCEPT