Anti Money Laundering Whistleblower Program . . . BECOMES LAW

We are pleased to announce that Congress passed a new anti money laundering whistleblower program.

The Anti-Money Laundering Act of 2020 (AML Act), which amends the Bank Secrecy Act (BSA) for the first time since 2001, was part of a defense bill first vetoed by the President but then overridden by Congress on New Year’s Day.

The BSA is designed to prevent and detect money laundering and terrorist financing.  The AML Act modernizes the BSA to stop those who seek to evade detection by using shell companies while committing fraud, funding terrorism, or committing other illegal behavior.

The AML Act also updates and strengthens the BSA’s whistleblower program. Whistleblowers who provide actionable information to the government may now receive up to 30% of the money seized based on that information.  Previously, awards were capped at $150,000.

The program bridges an enforcement gap left by federal banking whistleblower programs, as well as those whistleblower programs run by the Securities & Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), all of which have limited jurisdiction over potential money laundering violations. It was modeled after the SEC whistleblower program, which has recovered more than $2 billion in monetary sanctions due to whistleblower tips, and rewarded whistleblowers with hundreds of millions of dollars. The AML program may have a similarly far-reaching impact.

The new legislation can be viewed here.