Bill encourages consumer fraud reporting by whistleblowers

0
48

Sen. Catherine Cortez Masto (D-NV) has introduced a bill she said incentivizes consumer fraud reporting to the Consumer Financial Protection Bureau (CFPB).

© Shutterstock

The Financial Compensation for Consumer Financial Protection Bureau (CFPB) Whistleblowers Act is cosponsored by Senate Banking, Housing, and Urban Affairs Committee Chairman Sen. Sherrod Brown (D-OH) and Sens. Dick Durbin (D-IL), Elizabeth Warren (D-MA), Jeff Merkley (D-OR), Richard Blumenthal (D-CT) and Tina Smith (D-MN).

The bill says the CFPB would be able to reward whistleblowers between 10 and 30 percent of a particular settlement award from the Civil Penalty Fund. Additionally, with regard to cases involving monetary penalties of less than $1 million, the CFPB would be able to award any single whistleblower 10 percent of the amount collected or $50,000, whichever is greater.

“Whistleblowers are essential to our democracy,” Brown said. “Whistleblowers risk their career and their reputation to reveal corruption and bad actors seeking to exploit consumers and our government. We must do more to protect them during and after the pandemic to ensure that whistleblowers feel safe coming forward. This legislation does just that by protecting whistleblowers from retaliation and incentivizing them to come forward with their information.”

The legislation seeks to reward whistleblowers with compensation for reporting illegal activities to the CFPB, noting whistleblower statutes protect people from unfair practices, fraud and abuse.

“Whistleblowers play a vital role in protecting consumers from exploitation, risking their careers and livelihoods to report corrupt and unethical business practices,” Cortez Masto said. “Protecting consumers from fraud has been a top priority for me throughout my career, and we’ve got to do more to help vulnerable Nevadans. This legislation will not only make it safer for whistleblowers to report wrongdoing, it will also protect Nevada consumers from bad actors and discourage future misconduct by holding companies accountable.”

The measure would also enable a whistleblower to retain independent counsel and does not require the whistleblower to enter a contract with the CFPB. Further, it protects a whistleblower’s identity.

The post Bill encourages consumer fraud reporting by whistleblowers appeared first on Financial Regulation News.