Whistleblower Programs

Over the course of 2025, the enforcement framework for corporate misconduct evolved to place a premium on the role of the individual insider. While DOJ’s Criminal (CRM) and Antitrust (ATR) Divisions, and the U.S. Attorney’s Office for the Southern District of New York (SDNY), utilized different statutory tools rather than a single coordinated directive, their respective policy updates have converged on a similar outcome: the expansion of whistleblower leverage.

For company and outside counsel, these developments have introduced structural constraints into the internal investigation process. By establishing specific look-back periods for financial awards and distinct immunity channels for culpable individuals, the government has created incentives that often run counter to a company’s preference for a deliberative, comprehensive review. The result is an environment where the timeline for assessing an allegation is increasingly dictated by the risk of an external report rather than the pace of factual development.

DOJ: The 120-Day Look-Back and the ‘Minimal Participant’ Exception

On May 12, 2025, the DOJ revised its Corporate Whistleblower Awards Pilot Program. While the program attracted attention for its financial incentives—awards up to 30 percent of the first $100 million in net proceeds forfeited—the DOJ introduced two structural changes that significantly increase the pressure on corporate compliance functions.

First, under Section II(2)(d) of the revised policy, the DOJ codified a “safe harbor” that allows a whistleblower to report misconduct internally and wait up to 120 days before contacting the DOJ, without losing their place in line. If the individual submits their information to the DOJ within that window, the DOJ “will deem the date the individual provided original information to the entity’s internal reporting structure as the date of the individual’s original disclosure to the Department.” This establishes a retroactive priority system. By treating the date of the internal complaint as the effective date of the government report, the policy allows whistleblowers to secure “first-in” status based on when they made their internal report, not when they contacted the DOJ. By operation of the policy, a company that self-discloses months after an internal report—even if acting diligently—may find its disclosure rendered second-in-line by the whistleblower’s retroactive priority date.

Second, the DOJ expanded the universe of potential whistleblowers to include individuals who were themselves implicated in the misconduct. While the program generally excludes individuals who meaningfully participated in the criminal activity, Footnote 4 introduces a critical exception for “minimal participants”—defined under U.S.S.G. § 3B1.2 as those “plainly among the least culpable of those involved in the conduct of a group.” The policy explicitly links this financial eligibility to the CRM Division’s separate Pilot Program on Voluntary Self-Disclosures for Individuals, noting that such individuals can potentially secure both a Non-Prosecution Agreement (NPA) and a financial award. This alignment creates a powerful dual incentive: a mid-level employee involved in a scheme now has a path to secure both their liberty and a financial award, effectively removing the self-incrimination barrier that has historically kept co-conspirators silent.

Antitrust Division: The Expansion of Financial Rewards

On May 7, 2025, the ATR Division moved to close a significant gap in its enforcement arsenal by establishing the Whistleblower Rewards Program. Historically, the ATR Division has lacked the direct statutory authority to pay awards, relying instead on its Corporate Leniency Policy (CLP), which grants immunity to the first corporation to self-disclose. Through a Memorandum of Understanding with the U.S. Postal Service (USPS), the ATR Division has now leveraged the USPS’s existing authority under 39 U.S.C. § 2601 to pay rewards for information regarding Sherman Act violations that affect the mails or postal revenues.

While the program requires a nexus to the Postal Service, the MOU explicitly notes that the harm to the USPS “need not be material,” effectively broadening the program’s scope to cover a wide swath of “horizontal, ‘per se’ unlawful agreements, such as price fixing, bid rigging, and market allocation.”

This initiative introduces a competing incentive structure to the CLP. Previously, a company’s primary risk was that a co-conspirator would report first to secure immunity. Now, the risk is also internal. With the presumption of an award of “at least 15 percent of the recovered criminal fine” (capped at 30 percent), an employee aware of a cartel has a lucrative alternative to silence. Crucially, the program defines a voluntary submission as one made “before a formal demand (e.g., grand jury subpoena)... is served.” The practical result is a new, asymmetrical risk: an employee’s independent financial interest in reporting can now trigger federal scrutiny well before the company has had the opportunity—or the inclination—to weigh the benefits of self-disclosure. 

SDNY: Individual Immunity

Effective January 14, 2025, the SDNY implemented the Whistleblower Non-Prosecution Pilot Program. Unlike the DOJ program, which uses financial rewards to attract tips, the SDNY pilot incentivizes disclosure by offering an NPA to individuals who might otherwise face prosecution.

The program’s eligibility criteria prioritize the timing of the disclosure. Condition 1 mandates that the “misconduct has not previously been made public and is not already known to SDNY or to any component of the DOJ.” This establishes a zero-sum dynamic between the company and the individual. If the company investigates and self-discloses first, the individual loses their eligibility for an NPA. Conversely, if the individual reports first to secure their freedom, the company faces an investigation it did not initiate. This structure discourages culpable employees from reporting internally or waiting for an internal investigation to conclude; their only possible guarantee of immunity lies in beating the company to the prosecutor’s office.

Additionally, the policy weaponizes corporate hierarchy to encourage reporting from the middle. Condition 5 explicitly disqualifies “the highest-ranking person within the organization” (such as the CEO or CFO) and anyone who “exercises primary control over the operations.” By stripping senior leadership of eligibility, the SDNY creates a wedge between senior executives and their subordinates.

Looking Ahead to 2026 and Beyond

The policy updates of 2025 mark a distinct maturation in federal whistleblower enforcement. While external reporting channels are not new, the specific innovations of the past year—namely, the extension of financial eligibility to “minimal participants” and the SDNY’s offer of total immunity to co-conspirators—have fundamentally altered the calculus for insiders. By creating a structured “race” that specifically targets those with potential criminal exposure, the government has effectively created a parallel track for employees that runs independently of, and potentially faster than, corporate governance.

For company and outside counsel, the practical consequence is a loss of exclusive control over the pacing of an investigation. In this environment, the challenge is to integrate the assessment of whistleblower risk directly into the initial scoping of an investigation. Rather than waiting for substantive corroboration of the underlying misconduct, counsel must make earlier judgments about the reporter’s likely trajectory. The decision-making process regarding self-disclosure must move from a sequential model—investigate, then decide—to a concurrent one.

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