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Senate Unanimously Passes Key Reforms to Anti-Money Laundering Whistleblower Program

Washington, D.C. – WEBWIRE

Yesterday evening, the U.S. Senate unanimously passed the bipartisan Anti-Money Laundering (AML) Whistleblower Improvement Act. The bill fixes the U.S. Treasury Department’s broken AML program, which has struggled to obtain whistleblowers to disclose information on money laundering because of legislative shortcomings.

“This bill is urgently needed to stop Russian money laundering and the criminal abuse of the banking systems,” said leading whistleblower attorney Stephen M. Kohn of Kohn, Kohn & Colapinto who has worked pro bono over the past two years to fix the AML whistleblower law. “Money laundering is at the heart of corruption, as those who take bribes, sell drugs and set up illegal foreign accounts need to hide how they obtained their funds"

“The Senate’s action, during the lame duck session, exemplifies how important immediately passing this bill is,” continued Kohn, who represents Danske Bank whistleblower Howard Wilkinson in a landmark $234 billion money laundering case. “Once signed into law it will immediately be able to mobilize whistleblowers to disclose where the billions of dollars in illegal Russian oligarch monies are stashed. It was an AML whistleblower in Europe who pointed out that the Russian secret police and Putin’s own family were laundering money. It will be whistleblowers who tell us where those funds are, once the AML whistleblower bill unanimously approved by the Senate is passed by the House.”

“The House Financial Services Committee unanimously approved the bill and it can and must be voted on by the full House as quickly as possible. Whistleblowers need to be enabled to report the abuses of Russia, and the illegal use of the billions of dollars their leaders illegally laundered, right now,” concluded Kohn, who also serves as the Chairman of the Board of the National Whistleblower Center.

The AML Whistleblower Improvement Act provides financial incentives for whistleblowers who report illegal money laundering. AML whistleblowers are at the greatest risk of retaliation. The illegal launders are often drug dealers, persons involved in terrorist financing, powerful millionaires and billionaires who illegally hide their wealth offshore, and Russian oligarchs covered under U.S. sanctions. The bill is modeled on the Dodd-Frank Act, which established the highly successful SEC and CFTC whistleblower programs.

The bill establishes two fundamental reforms: the right to get paid if your information results in a successful prosecution and the creation of a fund to pay AML whistleblower awards, while ensuring that no taxpayers monies are ever used. Under the bill the fines obtained by those convicted of illegal money laundering pay whistleblowers and are used to induce others to step forward.

The AML Whistleblower Improvement Act is cosponsored by Senators Chuck Grassley (R-IA), Raphael Warnock (D-GA), and Elizabeth Warren (D-MA). A companion version of the bill is cosponsored in the House by Representatives Alma Adams (D-NC) and Anthony Gonzalez (R-OH).

Kohn is available for further comment on the matter.

Further Reading:
Copy of S.3316 (unanimously passed by Senate on December 7, 2022)

House Report 117-423, explaining need for the bill (the House Financial Services Committee unanimously supported the House version of S.3316)

Whistleblower rewards law: fixing money laundering loopholes | Reuters

Congress needs to pass money laundering and sanctions-busting whistleblower protections | The Hill


 Anti-money Laundering

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