Initiatives I Hope the Antitrust Division Will Consider, Continued

By: Robert Connolly (Cartel Capers)

In a prior post I listed a number of ideas I thought it would be useful for the Biden Administration’s Antitrust Division to consider when the new leadership is in place.  The first item I wrote on was “A Call to Reopen the Atlanta and Dallas Field Offices.”  Below is a short note on another initiative I hope the DOJ Antitrust Division will consider:

• Support Senator Klobuchar’s Proposed Legislation to Establish Criminal Antitrust Whistleblower Incentives

Senator Klobuchar has included in her sweeping antitrust reform proposal provisions to provide financial incentives to criminal antitrust whistleblowers. The Senator’s proposal is based on the very successful SEC whistleblower legislation which has become one of the SEC’s primary enforcement tools.  See Senator Klobuchar Unveils Wide Ranging Antitrust Enforcement Legislation. Cartel Capers, Feb. 4, 2021.

I’ve written a great deal about the tremendous boost for cartel enforcement that would come from a criminal antitrust whistleblower incentive program like that of the SEC’s. see e.g., Cartel Capers, April 9, 2018, It’s A Crime There Isn’t a Criminal Antitrust Whistleblower Statute.  I initially became interested in this subject because it seemed odd (and wrong) that there was a financial incentive for a whistleblower to expose a cartel against the government via a False Claims Act case but there were no financial incentives available for a whistleblower who wanted to expose a cartel that victimized private individuals. But the Klobuchar proposal would not only provide a financial incentive for whistleblowing on cartels generally, but it would also greatly enhance whistleblowing on bid rigging to the government for two reasons:

FCA filing v. Providing Information of Collusion to the Government

1. Amount of Information Needed

A whistleblower can, and some have, filed False Claims Act cases alleging the government was the victim of a bid rigging scheme.  The Korean Fuel Oil case is the latest example, of whistleblowers being well rewarded for coming forward, filing a case and exposing a bid rigging scheme.  See Cartel Capers, http://cartelcapers.com/blog/south-korea-bid-rigging-whistleblower-case-and-related-antitrust-division-criminal-cases/. But it takes far more information to file a False Claims Act case than it does to provide a “tip” to law enforcement about collusion.  It is likely there are many times the number of potential whistleblowers who could provide law enforcement with information about collusion than could file a False Claims case.  Whistleblower attorneys know it is far easier to present information to the DOJ than to actually file an FCA Complaint.  The information provided via a tip may or may not be acted on; the FCA filing requires a long and extensive and expensive commitment (as well as requiring far more actual facts supporting the allegation.)

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