RULE 6

Think Globally

Think Globally

Lessons Learned From Danske Bank Money Laundering Case

Introduction

The United States is a global leader in whistleblower legislation, with thousands of informants worldwide reporting under its laws annually. Recognized as crucial contributors to international law enforcement, most whistleblowers are supported by reward laws regardless of their location. The Organization for Economic Co-operation and Development (OECD) applauds the Dodd-Frank Act for enabling foreign informants to file confidential, anonymous reports, thus bolstering international anti-corruption efforts. Additionally, the Foreign Corrupt Practices Act and Commodity Exchange Act have generated billions in penalties while prosecuting multinational companies.

“Very few other countries have any track record of prosecuting deliberate…violations, let alone a legal process that would protect witnesses from obstruction of justice…”

U.S. Department of Justice, in United States v. Efploia

Tools for International Whistleblowers

The United States and more than 140 other nations have approved the United Nations Convention against Corruption, which contains two mandates for the protection of whistleblowers. Article 32 prohibits retaliation against witnesses. Article 33 urges nations to enact “domestic” legislation to “provide protection” against “unjust treatment” for any person who reports evidence of corruption to “competent authorities.”

Council of Europe, Civil Law Convention on Corruption. Article 9 requires European countries to protect whistleblowers. The text of the convention is published in multiple languages on their website on whistleblowing.

On July 27, 2000, the U.S. Senate ratified the Inter-American Convention against Corruption. Article III (8) of that convention stipulates that the United States, and other countries that ratified the agreement, create “Systems for protecting public servants and private citizens who, in good faith, report acts of corruption, including protection of their identities, in accordance with their Constitutions and the basic principles of their domestic legal systems.”

The European Union approved a Directive requiring all member states to implement domestic whistleblower laws as of December 2021. However, most EU nations failed to meet this deadline, and others have implemented laws that fall short of the mandatory requirements of the Directive.

Read The EU Whistleblower Directive

Criticism of the EU’s implementation of the Directive can be found at “Will Europe Fail to Protect Whistleblowers?”

Theo Nyreröd et al., “Chapter 5: Whistleblowing in the EU: The enforcement perspective,” Selected Papers from the International Whistleblowing Research Network Conference at Maynooth University (Sept. 2021).

Whistleblowers in EU nations need to review their country’s specific law implementing the Directive, and should also review the Directive itself for legislative history concerning the Directive’s numerous requirements.

Information on the Canadian offshore tax reward program is published online by the Canadian Revenue Agency.

Information on the Ontario Securities Commission’s whistleblower program.

A critique of the United Kingdom’s whistleblower law: Simon Wolfe and Mark Worth, Not Measuring Up: PIDA Now Rates Poorly against International Standard (Thompson Reuters Foundation, 2016).

A critique of whistleblower status in Australia: “America Pays Millions to Whistleblower at BHP; We Hound Them from Their Jobs,” Sydney Morning Herald (Aug. 29, 2016). The article describes problems facing Australian whistleblowers.

Information on the murder of South African whistleblower Jimmy Mohlala.

Transparency International’s recommendation for whistleblower protections is posted at www.transparency.org/files/content/activity/2009_PrinciplesForWhistleblowingLegislation_EN.pdf.

The Centre for Media Pluralism and Media Freedom publishes an online overview of whistleblower protections in all European Union countries at http://journalism.cmpf.eui.eu/maps/whistleblowing.

The Organization for Economic Co-Operation and Development (OECD) published “Whistleblower Protection: Encouraging Reporting,” an overview of international whistleblower laws in its publication CleanGovBiz (July 2012). The article is available at www.oecd.org/cleangovbiz/toolkit/50042935.pdf.

Various articles discussing the status of international whistleblower protections are available at https://euobserver.com/justice/121873 (European Union rejects whistleblower protections); http://knowledgeofindia.com/list-of-whistleblowers-in-india/ (whistleblower from India killed); http://mg.co.za/article/2009-01-05-anc-whistleblower-killed (South African whistleblower killed); www.ifex.org/philippines/2005/03/30/whistleblower_murdered/ (whistleblower in Philippines killed).

Public Law 112-208 (Dec. 14, 2012) is a U.S. law imposing sanctions on Russia due to the death of whistleblower Sergei Leonidovich Magnitsky.

The following cases hold that international whistleblowers cannot obtain on-the-job protection under U.S. whistleblower laws: Carnero v. Boston Scientific Corp., 433 F.3d 1 (1st Cir. 2006) (international employee not covered under Sarbanes-Oxley Act wrongful discharge law); Liu Meng-Lin v. Siemens AG, 763 F.3d 175 (2nd Cir. 2014) (international employee not covered under Dodd-Frank Act anti-retaliation law).

CFTC Whistleblower Alert: Blow the Whistle on Foreign Corrupt Practices in the Commodities and Derivatives Markets (May 2019), https://www.whistleblower.gov/whistlebloweralerts/FCP_WBO_Alert.htm; CFTC Press Release Number 8326-20, CFTC Orders Vitol Inc. to Pay $95.7 Million for Corruption-Based Fraud and Attempted Manipulation (Dec. 3, 2020), https://www.cftc.gov/PressRoom/PressReleases/8326-20; Dep’t of Justice, Press Release, Vitol Inc. Agrees to Pay over $135 Million to Resolve Foreign Bribery Case (Dec. 3, 2020), https://www.justice.gov/opa/pr/vitol-inc-agrees-pay-over-135-millionresolve-foreign-bribery-case; CFTC Enforcement Advisory: Advisory on Self-Reporting and Cooperation for CEA Violations Involving Foreign Corrupt Practices (Mar. 6, 2019); CFTC Press Release Number 7884-19, CFTC Division of Enforcement Issues Advisory on Violations of the Commodity Exchange Act Involving Foreign Corrupt Practices (Mar. 6, 2019), www.cftc.gov/PressRoom/PressReleases/7884-19; Remarks of CFTC Director of Enforcement James M. McDonald at the American Bar Association’s National Institute on White Collar Crime (Mar. 6, 2019), https://www.cftc.gov/PressRoom/SpeechesTestimony/opamcdonald2.

The Foreign Corrupt Practices Act, 15 U.S.C. § 78m and § 78dd-1, et seq.

The Department of Justice resource page on the FCPA is located at www.justice.gov/criminal-fraud/foreign-corrupt-practices-act.

The legislative history of the FCPA is published by the DOJ at www.justice.gov/criminal-fraud/legislative-history.

The best source of information explaining the requirements of the FCPA is the Resource Guide to the U.S. Foreign Corrupt Practices Act, published by the Criminal Division of the DOJ and the Enforcement Division of the Securities and Exchange Commission. A copy of this guide is available at www.whistleblowers.org.

The FCPA statute is translated into fifty languages at www.justice.gov/criminal-fraud/statutes-regulations.

The SEC publishes a list of FCPA prosecutions at www.sec.gov/spotlight/fcpa/fcpa-cases.shtml.

The following articles provide additional information and perspectives on FCPA. Bryan Cave, “Alert: The Implications for FCPA Enforcement of the SEC’s New Whistleblower Rules” (June 22, 2011), available at www.bryancave.com; Philip M. Nichols, “The Neomercantilist Fallacy and the Contextual Reality of the Foreign Corrupt Practices Act,” 53 Harvard Journal on Legislation 203 (Winter 2016) (broad scope of FCPA); Daniel Grimm, “Traversing the Minefield: Joint Ventures and the Foreign Corrupt Practices Act,” 9 Virginia Law and Business Review 91 (2014) (broad reach of FCPA).

The SEC has a web page, “FCPA Spotlight,” located at www.sec.gov/spotlight/fcpa.shtml. The SEC’s website also contains a list of every foreign company that sells stocks to Americans under the American Depository Receipt program.

An FCPA violation also implicates the following laws, which can give rise to additional penalties: Sarbanes-Oxley Act, Section 302 (15 U.S.C. § 7241) (accuracy of financial reports); Section 404 (15 U.S.C. § 7262) (internal controls over financial reporting); Travel Act (18 U.S.C. § 1952); as well as laws covering money laundering, mail and wire fraud, false certifications, and violations of the Internal Revenue Code.

See Rules 18 (IRS) and 21 (money laundering).

John A. Koskinen, Commissioner, Internal Revenue Service, Remarks at the U.S. Council for International Business–OECD International Tax Conference (June 3, 2014).

Matthew Allen, “Swiss-U.S. Tax Evasion Saga: Where Are We Now?” (Jan. 2016)

IRS Press Release, “Offshore Compliance Programs Generate $8 Billion.”

Documentation regarding the impact of Bradley Birkenfeld’s whistleblowing is set forth in Stephen Kohn’s article “$13.769 Billion Reasons to Thank Whistleblowers on Tax Day” (Apr. 18, 2016)

See Rule 23. The APPS whistleblower reward provision is codified at 33 U.S.C. § 1908(a).

The International Convention for the Prevention of Pollution from Ships (MARPOL 73/78) is available at http://library.arcticportal.org/1699/1/marpol.pdf.

A practical guide to the MARPOL convention is available at https://maddenmaritime.files.wordpress.com/2015/08/marpol-practical-guide.pdf.

U.S. DOJ, Environment and Natural Resources Division. A motion requesting 50 percent whistleblower reward in U.S. v. Overseas Shipholding Group, Inc., 06-CR-10408 (D. Mass, March 15, 2007) is available at www.globalwhistleblower.org.

Michael G. Chalos and Wayne Parker, “The Criminalization of MARPOL Violations and Maritime Accidents in the United States,” 23 University of San Francisco Maritime Law Journal 206 (Fall 2011). Although anti-whistleblower in tone and content, this article sets forth the various laws and legal standards applicable to APPS prosecutions.

“Avoiding the APPS Magic Pipe Trap,” Officer of the Watch website (Nov. 14, 2012), offers another anti-whistleblower position, https://officerofthewatch.com/2012/11/14/avoiding-the-apps-magic-pipe-trap/.

A detailed listing of APPS cases for which rewards were paid (including copies of the indictments, plea agreements, and whistleblower reward filings) is posted at https://www.kkc.com/laws%2c-statues-and-regulations/ocean-pollution-%28apps002fmarpol%29.pdf.

The Marine Defenders organization publishes information on APPS whistleblower rules, and also has a handbook designed to help seamen involved in government investigations. See www.marinedefenders.com/commercial/rewards.php.

U.S. v. Efploia Shipping Co. S.A., Case 1:11-cr-00652-MJG, Bench Decision Re: Whistleblower Award (ECF Doc. 80) (D. Maryland) (Apr. 25, 2016). The Court discussed congressional intent behind the APPS whistleblower provision and the fact that most, if not all, APPS prosecutions come from evidence provided by whistleblowers.

DOJ press release regarding the Efploia Shipping Company and Aquarosa Shipping case is available at www.justice.gov/opa/pr/two-shipping-corporations-plead-guilty-and-are-sentenced-maryland-obstruction-justice-and.

The first case to recognize whistleblowing as a potential justification for political asylum was Grava v. INS, 205 F.3d 1177 (9th Cir. 2000). Antonyan v. Holder, 642 F.3d 1250 (9th Cir. 2011) broadened the scope of the Grava holding. Since 2000 the Grava case has been followed in other federal court jurisdictions that considered this issue. See, for example, Bu v. Gonzales, 490 F.3d 424 (6th Cir. 2007); Cao v. Attorney General, 407 F.3d 146 (3rd. Cir. 2005); Rodas Castro v. Holder, 597 F.3d 93 (2nd Cir. 2010); Haxhiu v. Mukasey, 519 F.3d 685 (7th Cir. 2008); Hayrapetyan v. Mukasey, 534F.3d 1330 (10th Cir. 2008); Zhu v. Mukasey, 537 F.3d 1034 (9th Cir. 2008).

Aimee L. Mayer-Salins, “Asylum and Withholding of Removal Claims Involving Corruption and Whistleblowing,” published in DOJ newsletter “Immigration Law Advisor,” available at www.justice.gov/sites/default/files/eoir/pages/attachments/2015/02/26/vol9no2ed.pdf.

Frequently Asked Questions

Related Rules

Order Your Copy Today!

All purchases or donations proceeds go to support the National Whistleblower Center, a 501(c)(3) non-profit organization dedicated to supporting whistleblowers.

What's Inside

This books covers all federal and state laws regarding whistleblowing, including protections, rewards, and procedures for whistleblowing.

Meet the Author

Stephen M. Kohn is considered the world’s leading authority on international whistleblower law, and behind some of todays modern whistleblower rules.

Introduction: The Revolutionary Roots of Modern Whistleblowing

Law Library

The Law Library is a free companion to the Rules for Whistleblowers, complete with relevant whistleblower cases and important links and resources.

Speaking Engagement

Stephen Kohn enjoys speaking to universities of all sizes, students and professionals, the media, general public, and government officials.

Shipping is to the United States Only

For international orders, please contact orders@kkc.com.