On April 15, the Department of Justice (DOJ) publicly released a memorandum fleshing out its previously announced corporate whistleblower program, which is intended to induce individuals to report alleged criminal conduct, particularly by corporates, through the use of non-prosecution agreements. Indicative of the importance the DOJ is attaching to this new whistleblower program, the DOJ has publicly released this memorandum 45 days ahead of schedule! DOJ’s memorandum discusses non-prosecution agreements (NPAs) generally, but the memorandum’s goal is to provide clarity and assurances as to when NPAs will be offered — a process that was largely unclear until now.

While the DOJ’s March 2024 announcements of the new program were focused on its potential use in generating new FCPA cases, as we predicted, health care fraud is front and center in the conduct DOJ is hunting with its new bounty program. As outlined by Principal Deputy Assistant Attorney General Nicole M. Argentieri on April 22, the DOJ intends to utilize this program to generate new cases involving:

• Schemes involving financial institutions — including money laundering and criminal compliance-related schemes;
• Schemes related to the integrity of financial markets involving financial institutions, investment advisors or funds, or public or large private companies;
• Foreign corruption schemes, including violations of the Foreign Corrupt Practices Act, Foreign Extortion Prevention Act, and associated money laundering;
• Health care fraud and kickback schemes;
• Federal contract fraud schemes; and
• Domestic corruption schemes involving bribes or kickbacks paid by or through public or private companies.

Under the program, individuals who voluntarily disclose to DOJ’s Criminal Division such schemes after April 15, 2024, will be eligible for a non-prosecution agreement, provided that they fully cooperate, return ill-gotten profits, and meet the conditions below: 

• Disclosures must be made via email to NPA.Pilot@usdoj.gov, preferably utilizing the DOJ’s new Intake Form;
• The information reported must be “original,” meaning it is non-public information not previously known to any department of the DOJ;
• The disclosure must also be voluntary, that is before any demand for information is directed at any individual or company by the DOJ. Additionally, the disclosure cannot be made under a preexisting obligation to the DOJ, such as through a prior agreement with the DOJ;
• The disclosure must include all information known by the individual related to any misconduct he/she participated in, and must further be willing to cooperate and provide substantial assistance to the government in any further investigations or prosecutions; and
• The disclosing party must pay back all profit from the criminal scheme.

Notably, CEOs and CFOs of public or private companies do not qualify for the program, along with any “organizer/leader of the scheme.” Individuals with a prior felony conviction or any conviction involving fraud or dishonesty also do not qualify. 

This memorandum also provides clearer guidelines to the public regarding when NPAs will be offered. The circumstances of when the DOJ will offer an NPA have historically been murky, but the DOJ has now changed course. The goal is to reward disclosure and provide companies with the opportunity to strengthen compliance programs in a manner that will provide early detection and better assurance that DOJ will provide an NPA in the face of discovered illegal conduct. However, the question that remains is precisely how the government will process these disclosures and investigate them, as well as how long the process may take. This new policy also comes on the heels of a separate policy introduced by the DOJ that is intended to financially reward whistleblowers who did not participate in the illegal conduct.