FCPA Related-Action Awards: When the Same Information Reaches Both Agencies

An FCPA whistleblower’s SEC related-action award can reach a qualifying Justice Department resolution. The same original information about Foreign Corrupt Practices Act violations must lead to successful enforcement by the Securities and Exchange Commission and help the Justice Department succeed. You may know why a consultant was paid, which customer decision the payment bought and where finance buried the expense. Those facts can matter to both agencies. The award question follows what your information helped each agency do.

What Makes a Justice Department Resolution an SEC Related Action?

An SEC FCPA whistleblower related-action award starts with a qualifying action by the Securities and Exchange Commission. The whistleblower must voluntarily provide original information that leads to successful enforcement, and the SEC action must order more than $1 million in monetary sanctions. The SEC calls this the covered action. The same information must also contribute to the other authority’s successful action.

That connection is central to the SEC’s related-action rules. A Justice Department-only resolution does not create the necessary SEC covered action. What connects the actions is the information you supplied and how each agency used it.

A Justice Department deferred prosecution agreement or non-prosecution agreement can count as the related action. A deferred prosecution agreement puts filed charges on hold under stated conditions. A non-prosecution agreement conditionally agrees not to file them. Either can matter to a whistleblower’s award, but the agreement’s existence does not establish the whistleblower’s contribution. We examine the information behind the result alongside the agreement itself.

Can an Existing Investigation Still Use My Information?

Yes, information can qualify when it significantly contributes to the success of an investigation already underway. Original information can come from independent knowledge or analysis. The useful question is what the information adds: a transaction investigators had not understood, records that explain the payment, or assistance that advances the case.

The Securities and Exchange Commission’s May 5, 2023 award order shows the difference that contribution can make. The agency had already opened its investigation when the successful whistleblower supplied information. The information expanded the investigation and saved staff time and resources, and the whistleblower continued helping through written submissions, communications and interviews.

The SEC also found that the same original information reached another agency and helped produce the related actions. Its order provided for an award expected to result in approximately $279 million in payment across the covered and related actions. This is a redacted SEC award example, with the company unidentified. Its value here is the agency’s explanation of what the whistleblower contributed to each result.

Being the first person to recognize a problem and helping the government establish it are different contributions. An insider who can explain a misleading ledger entry or connect an intermediary to the actual recipient may add something important even after investigators know there is a problem. We work with you on that connection between what you know and what it helps establish.

What Money Determines the Reward?

An SEC related-action award and a direct claim under the Justice Department’s corporate whistleblower pilot are different paths to payment. Their award calculations use different money, even when the programs examine the same misconduct.

The SEC percentage applies to qualifying collections, rather than only the dollars above its entry threshold. Under the Justice Department’s pilot terms, qualifying forfeiture must exceed $1 million in net proceeds.

Company disclosure credit is separate again. A company can receive favorable treatment for reporting its own conduct, while an individual’s award depends on the whistleblower program. When an employee’s information prompts an internal investigation, we examine both the company’s disclosure and the employee’s own contribution.

Can a Whistleblower Claim Both SEC and Justice Department Awards?

The Justice Department whistleblower pilot’s SEC overlap rule changed on July 30, 2026. Under that revision, a whistleblower can be considered even when eligible for another award program. The policy prohibits duplicate awards for the same or substantially the same misconduct.

The original August 1, 2024 pilot excluded someone eligible under another qualifying award program for the same scheme. That older exclusion helped produce the shorthand that a public company belonged with the SEC and a private company belonged with the Justice Department. The revised rule requires a closer look at the information, the actions and the programs involved. Company status alone does not answer the overlap question.

The Securities and Exchange Commission has its own coordination rules, expanded by amendments effective October 3, 2022. The July revision addresses eligibility under the Justice Department pilot and leaves the SEC’s conditions in place. We assess the programs together with you, including questions about disclosure of another award application and waiver of a competing claim.

The revised pilot covers company-related violations of the Foreign Corrupt Practices Act, the Foreign Extortion Prevention Act and related money laundering. It requires original, truthful, complete and voluntary information, cooperation and a successful qualifying forfeiture. Those requirements make the quality of the information central to the Justice Department route as well as the SEC route.

Does a Tip Also Apply for an Award?

A tip and an award application are separate submissions. We work through your reporting history, internal reports and the company’s own disclosures with you and FCPA whistleblower counsel, so the information and award claims are considered together.

Panasonic’s Consulting Payments Show What an Insider Can Explain

Panasonic Avionics supplied in-flight entertainment systems and communications services to airlines and airplane manufacturers. Under its deferred prosecution agreement in the criminal case, the company admitted using a service provider to pay consultants who performed limited or no work. The intermediary handled the invoices and payments while the company booked the expenses as consulting.

One recipient had been a senior contracts official at a government-owned Middle Eastern airline. Panasonic Avionics admitted paying the former official $875,000 through the service provider, with none or very few of those payments covering actual consulting services. The same criminal statement attributed $92,805,432 in profits to airline programs in which the official had involvement or influence. The payment records and the customer contracts explained different sides of the relationship.

The company’s admitted statement of facts described what internal audit found when it looked for the consultant’s work. The problem was more revealing than a missing attachment:

We see a business willing to keep paying for work it had not even requested. For the person in finance or procurement, the invoice, the work supposedly commissioned and the official’s customer role belong in the same account of the payment. The ledger description alone conceals the relationship that makes the expense consequential.

Why the Insider’s Information Matters

Whistleblower incentives can change conduct before a case begins. The March 2019 working paper Do Corporate Whistleblower Laws Deter Accounting Fraud?, supported by the University of Chicago Booth School of Business and Baruch College, studied companies exposed to state False Claims Acts through state pension-fund investments. It found a 5% to 9% reduction in the estimated likelihood of accounting fraud following that exposure. It also found that the federal SEC whistleblower program reduced the probability of accounting fraud more among firms not previously exposed to those state laws.

The False Claims Act is a separate whistleblower system. A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. FCPA reporting follows the agency award programs described here, rather than a private FCPA qui tam case.

The study’s point is broader than any one award: the prospect of an insider speaking up can affect a company’s behavior. The business records in the Panasonic case show why that insider knowledge matters. Someone who understands the supplier, the customer and the expense can explain a relationship that the accounting label leaves out.

Your Information Deserves the Right Award Strategy

If you know who really benefited from a consultant payment, a sales commission or an expense your company concealed, speak with our whistleblower experts about the payment and your reporting history. We connect the business evidence to the SEC and Justice Department award questions and bring in FCPA whistleblower lawyers who understand related actions and competing claims. We stay beside you as partners through the case, with your contribution at the center of the strategy.