Calls To Improve The Financial Institutions Reform, Recovery, and Enforcement Act of 1989
FIRREA Whistleblower Settlements Recover $19.9 Billion For Government
Increasing Rewards For Successful Whistleblowers
The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (“FIRREA”), 12 U.S.C. § 1833a et seq., and Financial Institutions Anti-Fraud Enforcement Act of 1990 (“FIAFEA”), 12 U.S.C. § 4201 et seq., offer rewards to whistleblowers with original information about certain illegal conduct by financial institutions and their employees. But a recent news network’s analysis of the history of the FIRREA whistleblower program suggests that the program needs enhancement. The whistleblower attorneys at Evans Law Firm, Inc. agree. We represent individuals in initiating enforcement actions under FIRREA and FIAFEA. If you have original information of bank fraud in Los Angeles or elsewhere in California call us today at (415)441-8669 and we can help. We can organize your information into a whistleblower application or declaration under the relevant rules with the goal of you receiving a reward for your efforts.
FIRREA Whistleblowers Recover Billions
A recent article published by the Whistleblower Network News reveals shortcomings in the FIRREA whistleblower program. The network reviewed documents released by the U.S. Department of Justice (DOJ) under the Freedom of Information Act (FOIA) that list every FIRREA settlement involving a whistleblower since 1989, when the law was first passed. The list comes to a total of six settlements. Those six settlements have returned an incredible $19.9 billion in fines from banking fraud, with $9.3 million (0.05%) of the money recovered going back to the whistleblowers. According to the report, while FIRREA’s whistleblower has been hugely successful for the government, the fact that there are only six settled whistleblower cases and the low reward percentage indicates that the incentive structure under FIRREA needs to be enhanced to encourage people within the financial industry to come forward with evidence of fraud and corruption. If FIERRA’s incentives for whistleblowers would change, it could follow the highly successful False Claims Act (FCA), 31 U.S.C. § 3729 et seq., and the U.S. Securities and Exchange Commission (SEC) whistleblower program (15 U.S.C. § 78o, as amended) leads.
Suggestions For Improving The FIRREA Whistleblower Program
FIRREA’s reward program pales in comparison to more successful regulatory tools like the FCA and the SEC. The SEC’s program has awarded more than $738 million to 134 whistleblowers in the eight years that it has been in use. FCA whistleblower cases recovers close to $3 billion every year for the government. When compared to the successful whistleblower rewards programs of the SEC and the FCA, FIRREA’s six whistleblower cases in 31 years is nothing short of a disaster, according to whistleblower advocates. One such advocate, former Attorney General Eric Holder, has urged legislation to expand the FIRREA whistleblower program as a means to better investigate financial crimes. Former AG Holder uses “the strong whistleblower amendment” in the FCA enacted by Congress in 1986 as a model for how FIRREA can be amended. The key difference in the laws’ whistleblower provisions, according to Mr. Holder, are their incentive structures. Both the FCA and the SEC Whistleblower Program set rewards at a minimum of 10% of the recovered fraud. If FIRREA had a similar minimum rewards for the six settled FIREEA cases, for instance would be $1.9 billion instead of the $9.3 million that was actually paid to whistleblowers. FIRREA caps rewards at $1.6 million regardless of the scale of the case, and that cap also operates as a disincentive for potential whistleblower. According to the WNN article, the data shows unambiguously that caps on reward programs weaken incentives for potential whistleblowers, thus crippling the government’s ability to root out corruption.
Ingrid M. Evans and the other Los Angeles whistleblower attorneys at Evans Law Firm represent whistleblowers in FIRREA cases If you have information of fraud that could be the basis for a FIRREA whistleblower case, call Ingrid and our other Los Angeles whistleblower attorneys today at (415) 441-8669, or by email at <a href=”mailto:email@example.com”>firstname.lastname@example.org</a>. We also handle cases brought under the False Claims Act for false claims for government payments; Securities and Exchange Commission (SEC) whistleblower cases for securities fraud (related to stocks, bonds, private placements and variable annuities for example); Internal Revenue Service (IRS) whistleblower cases for tax fraud, particularly offshore tax avoidance schemes; and Commodities Future Trading Commission (CFTC) cases involving fraud in the trading of commodities, futures, options, currencies and virtual currencies (like Bitcoin).