Anti Money Laundering Act 2020, has amended the recently enacted AML whistleblower improvement act, which significantly expanded the legal protections and financial incentives for whistleblowers to report AML violations.

FinCEN (Financial Crimes Enforcement Network) will soon propose regulations to implement the new whistleblower provisions. FIs (Financial Institutions) and other firms that comply with AML and sanctions should evaluate their existing internal whistleblower programs to ensure compliance with the new law and encourage employee whistleblowing.

The maximum award has been increased for eligible whistleblowers that voluntarily provide original information to the treasury department, DOJ or employer. Under the initiative, whistleblower awards were capped at $150,000. Whistleblowers are eligible for awards not less than 10% and 30% of financial sanctions gathered by the government for AML and sanctions violations. The enforcement actions have resulted in penalties worth millions. In several recent cases, the penalties exceeded $1 billion. 

Employment protection for whistleblowers is also included in AMLA. For instance, the act prohibits employers from discriminating against whistleblowers in terms and conditions of employment because of any lawful action by the Whistleblower in providing information to FinCEN, DOJ, or any other member of the committee. 

The Act also protects the Whistleblowers that provide tips on the misconduct of a person with the supervisory authority to investigate or terminate the misconduct. 

This way, AMLA protects internal and external whistleblowing by employees. 

Relief for individuals who prevail in complaints with the Department of Labor or in Federal lawsuits includes,

  1. Reinstatement with the same seniority level that the individual would have had but for the criminal retaliation.
  2. Two times the misconduct amount of back-pay otherwise owed to the individual, with interest.
  3. Compensatory damages must carry litigation amounts, witness charges and reasonable attorney’s fees. 
  4. Another appropriate remedy with respect to the conduct is also the subject of the complaint as applicable. 

As updated, the AMLA and FinCEN’s impending rules will dramatically improve the whistleblower roles under US AML sanctions and laws. FIs and other firms will also revise their internal programs to minimise any impasse laws and regulations on their operations. 

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