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DOJ’s New Antitrust Whistleblower Program: How to Enhance your Compliance Program
Early in July, the Department of Justice’s Antitrust Division launched a program to reward whistleblowers. What does this mean for you and your compliance program?
Earlier this week Jay Owen, Managing Director, addressed why companies should pay attention to the Antitrust Division’s Whistleblower Rewards Program. In this second post, he addresses antitrust-specific implications of the announcement.
In the weeks following the Presidential election in November 2024 there was rampant media speculation that antitrust enforcement, which had been a hallmark of the Biden administration, would be deprioritized and fall to the wayside. For individuals in compliance offices throughout this country, this probably seemed like welcome news- a reduction in a significant, but hard to quantify risk that every single company in the United States faces.
But, as Bart Schwartz and Yohir Akerman pointed out in a recent Guidepost blog post, a renewed willingness by the antitrust agencies to consider merger remedies may actually increase the legal, reputational, operational, and cyber risks associated with antitrust and competition laws. If these complications on the civil side weren’t enough to reawaken companies to the continued risks in the antitrust and competition space, the Antitrust Division’s announcement last week regarding the establishment of a Whistleblower Rewards Program should be enough to jolt everyone awake to the continued risks in this area.
For those unfamiliar with the Whistleblower Rewards Program, it is almost exactly what it sounds like it would be: via a partnership with the United States Postal Service, the Antitrust Division will offer whistleblower rewards of up to 30 percent to individuals who report antitrust crimes and related offenses. According to Assistant Attorney General Abigail Slater of the Antitrust Division, “The new Whistleblower Rewards Program will create a new pipeline of leads from individuals with firsthand knowledge of criminal antitrust and related offenses that will help us break down those walls of secrecy and hold violators accountable.” In a comment that seems to speak directly to compliance officers throughout the country, she added: “This program raises the stakes: If you’re fixing prices or rigging bids, don’t assume your scheme is safe — we will find and prosecute you, and someone you know may get a reward for helping us do it.”
While the number of whistleblower reports actually eligible for the Rewards Program may be fairly small—the statutory authorization for the program limits it to matters that “affect[] the Postal Service”[1]—individual employees are unlikely to take this statutory limitation into account when considering making a whistleblower complaint. This means that companies must treat the Rewards Program as what it is likely to become in practice: a general-purpose whistleblower hotline for all antitrust and competition related issues.
With this in mind, there are at least three things that essentially every company in the United States should do following the Antitrust Division’s announcement:
- Reexamine your underlying antitrust and competition related risk. Almost every company faces some form of antitrust risk: there is always a possibility that your sales team is agreeing on prices with a competitor, or that a rouge agent is rigging bids in a public procurement. With this announcement, the chances of any such behavior being reported just increased, meaning that almost every company’s potential antitrust and competition risk exposure just increased. If it’s been a while since your last comprehensive risk assessment, it may be time to conduct another one, including a specific focus on antitrust and competition related issues.
- Consider your current training and other controls. Companies that already know about their antitrust and competition related risks should use this as a wake-up call to review their training materials and other controls in this area. Are all salespeople properly trained on what is and isn’t permissible under the antitrust laws? Does the accounting department have procedures in place to detect suspicious bids before they ever leave the company? With the increased risk exposure brought about by the Whistleblower Rewards program, proactive companies should consider whether their internal systems are still up to the task, or if they need to be modernized up to meet the increased challenge.
- Reinforce your commitment to compliance with antitrust and competition related laws via messaging from the very top of the company. The tone from the top of the company is always important in setting a culture of compliance at the individual level. But executive communications are even more important in the context of developments like the Whistleblower Rewards Program: individuals who are aware of, but maybe not involved in, borderline fact patterns will be more likely to report to the government if they don’t think the company has, or will, stop the behavior internally. Communications from the top can give observers confidence that their company will address the issue and that they need not report to the government, as their company already has it under control. In other words, companies shouldn’t just walk the walk by developing effective compliance programs, they should also talk the talk at the highest level by letting employees know about these programs and how effective they are.
What Now?
It remains to be seen what the exact impact of the Antitrust Division’s Whistleblower Rewards Program will be, but the needle has unmistakably moved towards increased exposure to antitrust and competition related risks. Proactive companies should seize the opportunity to reexamine their underlying risks in this area and implement additional trainings, controls, and high level communications as needed to address the increased risk. Engaging a third-party consultant, like Guidepost, to provide a thorough assessment of your corporate compliance programs in order to ensure they meet current regulatory expectations and are robust enough to detect, prevent, and respond to potential violations, can be a critical step in safeguarding your organization against whistleblower-triggered investigations and costly enforcement actions.
[1] 39 USC 404(a)(7).
Jay D. Owen
Managing Director
Jay D. Owen is a seasoned legal professional with extensive experience in antitrust law. Most recently, he served as chief of the Defense, Industrials, and Aerospace Section at the Department of Justice’s Antitrust Division.
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