Could U.S. Whistleblower Laws Open a New Financing Stream for MPAs Worldwide?

MPA News

A bit of history: In 1986 the US Government revised its main anti-fraud law — the False Claims Act, which concerns fraud against government programs — to include rewards for whistleblowers. A whistleblower is a person who informs authorities when another person or organization has done something illegal. The new rewards — in which whistleblowers could receive a substantial share of any monetary penalties against the wrongdoers — were the first significant incentive for whistleblowing activity under US law.

Since then, the whistleblower reward system has quietly found its way into many other US laws — including nearly every environmental and wildlife law of the past 30 years. For the most part, the reward system has received little attention from conservationists to this point. But according to one expert, whistleblower rewards could unlock a potentially significant new source of funds for MPAs — including MPAs outside the US.

Stephen M. Kohn is Executive Director of the National Whistleblower Center (NWC), a legal advocacy organization. The NWC has spent 30 years supporting whistleblowers, mostly in the banking and securities sector where awareness of the reward system is relatively high. When Kohn realized in 2015 that the whistleblower reward system also existed throughout US environmental law, he decided that a tool that worked successfully in fighting financial crime should be applied just as energetically to fighting wildlife crime.

The NWC began developing the Global Wildlife Whistleblower Program to raise awareness of the reward tool and provide assistance to wildlife whistleblowers. It then entered the concept in the 2015-2016 Wildlife Crime Tech Challenge, a global contest run by the US Agency for International Development (USAID), TRAFFIC, and other groups. The Global Wildlife Whistleblower Program won the contest’s Grand Prize.

“The Grand Prize was awarded so that the NWC can establish a safe worldwide reporting system for wildlife whistleblowers,” says Kohn. Through the system, the reports are forwarded to attorneys, who then assist the whistleblowers in filing their concerns with the proper law enforcement agencies. Reports are all strictly confidential, and whistleblowers can file claims anonymously.

How the reward system could be harnessed to fund MPAs

Kohn provides a detailed explanation of how the whistleblower reward system could be applied to wildlife crime in a 2016 article in the Environmental Law Reporter. In synopsis, this is how it would work: Somewhere in the world, a fisherman catches an endangered fish, then sells it to a broker, who ships it to a US port. In this scenario, the fisherman, the broker, and the shipping company have each committed a crime under either the US’s Endangered Species Act (which addresses the taking of CITES-protected species) or Lacey Act (which addresses the trafficking). Anyone — US citizen or not — who is able to document the taking and trafficking of the fish, and whose documentation leads to a successful prosecution, would be eligible for a portion of the monetary penalties. “Documentation is necessary for a successful prosecution,” says Kohn. “The rewards are based on a successful prosecution, not on simply reporting an alleged violation.”

Another scenario: A fisherman fishes illegally inside a no-take area somewhere in the world and sells his catch to a broker, who ships it to a US port. In this case, the fisherman, broker, and shipping company have likely committed crimes under the US’s Illegal, Unreported, and Unregulated Fishing Enforcement Act, which was passed in 2015. (“The law is extremely broad and should cover fishes caught in no-fishing areas,” says Kohn.) Again anyone — US citizen or not — who is able to document the taking and trafficking of the catch would be eligible for a reward, pending successful prosecution. In this case, the reward would apply even if the taken species were not endangered.

This system could be harnessed by individuals or organizations to do two things at the same time: fight wildlife crime and make money. Both goals should be attractive to MPAs. Conceivably, affected MPAs could work together with NGOs and other interested parties to provide the necessary documentation — and to share in the rewards.

There is a caveat. As indicated above, the illegally caught fish must end up at a US port for the laws to apply. If they remain outside US waters, the reward system is irrelevant. That being said, the US is the world’s second-largest importer of seafood (after Japan) and nearly half of the imported seafood is wild-caught. With that demand, there is likely to be no shortage of ships bringing fish to the US, even with the application of whistleblower rewards.

Already in practice in marine pollution cases, some whistleblower rewards have exceeded $1 million

Although the whistleblower reward system is only just now being appreciated for fighting wildlife crime, it has been applied in dozens of marine pollution cases in the US in recent years. These are cases in which ships have illegally dumped waste somewhere in the world — a violation of the MARPOL Convention, to which the US is a signatory. Each pollution incident has been documented, usually by a crew member with a cellphone camera, then the offending ship has entered a US port. The crew member/whistleblower then contacts US law enforcement and the ship is seized. The whistleblowing can be lucrative in marine pollution cases. In some cases the rewards to whistleblowers have exceeded US $1 million.

It remains to be seen how large the whistleblower rewards would be for wildlife crime cases. Cases must emerge first and be litigated. That is one of the purposes of the Global Wildlife Whistleblower Program — to facilitate such cases.

With the change in US government in January 2017 to President Donald Trump, there may be a question of how vigorously US attorneys will prosecute cases like this, including the MARPOL ones. The cases could be viewed by the incoming government as unfriendly to business, particularly shipping, and thus not worth pursuing. Kohn suspects that won’t be the case, though.

“Currently there is broad bipartisan support for stopping ocean pollution and prosecuting illegal fishing,” he says. “There is no indication that the US government is going to stop prosecuting these cases. Moreover, once more whistleblowers step forward, there will be added pressure to increase the prosecutorial resources already dedicated to these cases. Simply stated, polluting the oceans is not popular. Illegally killing fish is not popular. These are not Democratic or Republican issues.” 

[Editor’s note: As indicated above, for a more-detailed analysis of the potential for US whistleblower rewards to be used in fighting wildlife crime worldwide, see Stephen Kohn’s 2016 article in Environmental Law Reporter, “Monetary Rewards for Wildlife Whistleblowers: A Game-Changer in Wildlife Trafficking Detection and Deterrence.]

For more information:

Stephen Kohn, National Whistleblower Center, US. Email: sk [at] kkc.com

National Whistleblower Center

Global Wildlife Whistleblower Program

Whistleblowing for Wildlife, Mongabay, 28 December 2016 — This article provides a lengthy interview with NWC Chief Operating Officer Ashley Binetti. In it she addresses the potential size of whistleblower rewards for wildlife crime, and the status of whistleblower programs within the US government agencies responsible for applying wildlife laws.

List of ocean pollution whistleblower cases — In many of the cases on this list, the fines and penalties assessed have been used to fund environmental organizations.


Box: Insights from a marine law expert on the impact of whistleblower rewards for marine conservation

MPA News asked attorney Ole Varmer, an expert in US marine law who was briefed on the Global Wildlife Whistleblower Program, for his thoughts on what impact whistleblower rewards could have — both on wildlife crime and on funding for conservation. Varmer responded:

“If establishing whistleblower award programs results in more cases of enforcement along the lines of success under [securities fraud cases] and MARPOL cases, then there would be a corresponding increase in enforcement and revenues for marine conservation. I am not convinced that this is a panacea for new funding. However, I am convinced that this is worth exploring, and that there is real potential to improve compliance — just by setting up the programs and doing a lot of education and outreach. Those doing illegal, unreported, and unregulated (IUU) fishing would start worrying about possible enforcement that hurts them financially and perhaps personally.”

Varmer added that he is optimistic the new Trump Administration will be open-minded about the application of whistleblower rewards to fight wildlife crime. “Particularly if it becomes a tool to address IUU fishing,” he said. “IUU fishing is an issue that has bipartisan support because it is so unfair to fisherman trying to make an honest livelihood.”

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