SDTX initiates whistleblower non-prosecution pilot program

HOUSTON - The U.S. Attorney's Office for the Southern District of Texas (SDTX) will immediately begin implementation of a pilot program to encourage early voluntary disclosure of previously unknown criminal conduct and to help identify and prosecute individuals most culpable for that misconduct, announced U.S. Attorney Alamdar S. Hamdani.

In exchange for self-disclosure and cooperation against others involved in the criminal conduct, SDTX will enter into a non-prosecution agreement where certain specified conditions are met.

"Rooting out fraud and corruption in the government and private sectors has always been a priority of the SDTX whether that corruption exists in the Rio Grande Valley's smallest towns or in and around Houston, the nation's fourth largest city," said Hamdani. "Those cases often rely on whistleblowers, individuals who witness wrongdoing and want to do the right thing by coming forward to law enforcement. This office's new policy is my way of encouraging those whistleblowers to come forward to assist our mission to expose and eliminate corruption throughout the district."

The hope is to incentivize individuals and their counsel to provide actionable and timely information by providing clarity on the requirements and benefits of self-disclosure. This could potentially help the office bring more misconduct to light and better protect the communities within the SDTX.

Reporting parties can be an individual or business, but must disclose criminal conduct of public or private companies, exchanges, financial institutions, investment advisers or investment finds. The disclosed criminal conduct may involve fraud, corporate control failures, affects on market integrity, criminal conduct involving state or local bribery and fraud relating to federal, state or local funds.

To be considered, reporting parties and their related information must meet certain key sets of conditions:

• The misconduct is not already public and known to the office, any Department of Justice component or federal law enforcement agency.

• The individual or organization discloses the criminal conduct voluntarily (e.g., not in response to a government inquiry, reporting obligation, existing agreement to report or prior to imminent threat of disclosure.)

• The individual or organization can provide substantial assistance and is prepared to fully cooperate in the investigation and prosecution of the disclosed conduct and recovery of any related criminal proceeds.

• The individual or organization truthfully and completely discloses all criminal conduct they know of or in which they have participated.

• The individual must not be a federal, state or local elected or appointed official; an official or agent of a federal investigative or law enforcement agency; expected to become of major public interest; the highest-ranking person within the organization or the person who exercises primary control over the organization's operations where the misconduct occurred.

• The individual did not lead or originate the alleged misconduct or illegal activity.

• The individual has not engaged in any criminal conduct involving the use of force or violence; any sex offense involving fraud, force or coercion of a minor; any offense involving terrorism or national security and does not have a conviction of any kind for conduct involving fraud or dishonesty.

• The individual must agree to forfeit any proceeds from the disclosed criminal wrongdoing and pay restitution to victims consistent with their role in the offense.

This policy does not apply to individuals or organizations providing information regarding violations of the Foreign Corrupt Practices Act, violations of federal or state campaign financing laws, federal patronage crimes, corruption of the electoral process, bribery of federal officials, federal tax offenses or federal environmental crimes.

The SDTX has sole discretion to determine whether an individual has satisfied each of the conditions necessary to consider a non-prosecution agreement.

Individuals or businesses who do not meet the above requirements may still be considered for a non-prosecution agreement on a discretionary basis in exchange for their cooperation after consideration of multiple factors.

Those who qualify for the Whistleblower Pilot Program are encouraged to take advantage of the opportunity to come clean, cooperate throughout the legal process and get on the right side of the law.

Individuals (including through counsel) seeking to be considered for the SDTX Whistleblower Pilot Program may use this WBP intake form to begin the process of disclosing criminal misconduct. Send completed document to the office at [email protected].

This policy does not apply to any other U.S. Attorney's Office or any other litigating component of the Justice Department. It also does not supersede any provision of the Justice Manual.