Constantine Cannon Partner Marlene Koury Featured in Law360 on How FinCEN’s Record $80M Fine Paves the Way for FinCEN Whistleblower Awards
By the Constantine Cannon Whistleblower Team
On April 21, Constantine Cannon Partner Marlene Koury shared an Expert Analysis in a Law360 article titled “Record Penalty Sets Stage For FinCEN Whistleblower Awards.”
Koury analyzed the importance of Financial Crimes Enforcement Network (FinCEN)’s proposed rule to launch monetary awards under its whistleblower program, enhancing enforcement of the Bank Secrecy Act and economic sanctions. She dove into FinCEN’s recent agency action, a record $80 million penalty against Canaccord Genuity LLC for BSA violations, FinCEN’s enforcement priorities considering the recent action, and what this could mean for future whistleblowers.
Regarding the penalty against Canaccord Genuity LLC, Koury explained: “The size of the penalty highlights FinCEN’s willingness to impose significant sanctions, particularly in cases where firms fail to meet core AML obligations.
While it is unknown whether a whistleblower was involved, it illustrates the financial stakes associated with reporting. Under the rule’s award structure, a recovery of this size could result in an award between $8 million and $24 million.”
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Read the complete article here and below:
Record Penalty Sets Stage For FinCEN Whistleblower Awards
Law360 (April 21, 2026, 4:12 PM EDT)
The Financial Crimes Enforcement Network recently took its final step toward launching monetary awards under its whistleblower program by publishing a long-anticipated proposed rule that signals an increasingly aggressive enforcement posture.[1]
The proposed rule, published in the Federal Register on April 1, implements statutory authority dating back to January 2021, when the Anti-Money Laundering Act established the program’s award structure. Congress expanded that authority in December 2022 through the Anti-Money Laundering Whistleblower Improvement Act.[2]
The program covers violations of the Bank Secrecy Act and economic sanctions administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control.
FinCEN has accepted tips since launching the program in 2021, but it has done so without rules governing how the program functions for both the agency and whistleblowers. The rule fills that gap.
For the first time, it sets out how the program will operate, including who qualifies, how to submit information, how FinCEN will calculate awards and what protections whistleblowers can expect. Once FinCEN finalizes the rule, it will begin processing and paying awards.
This article examines the significance of the proposed rule, outlines FinCEN’s enforcement priorities as signaled by recent agency action, including its record-setting penalty against Canaccord Genuity LLC, and identifies key considerations for institutions and whistleblowers.
Key Features of FinCEN’s Proposed Rule
The proposed rule establishes a mandatory award floor of 10% of monetary sanctions collected in a covered enforcement action exceeding $1 million. This is a departure from the AML Act, which authorized awards of up to 30% and left open the possibility of minimal or no awards. The mandatory minimum gives potential whistleblowers a clear reference point when deciding whether to come forward.
The rule goes further by creating a presumption that FinCEN will award the maximum 30% in cases where that amount equals $15 million or less. This should encourage reporting across a broad range of cases, not only those with the largest potential recoveries.
FinCEN has publicly reinforced these incentives. In announcing the agency’s launch of its dedicated whistleblower portal, Treasury Secretary Scott Bessent stated that the Treasury will “offer whistleblower payments to anyone who wants to tell us the who, what, when, where, and how this fraud and money laundering has occurred.”[3]
The rule also clarifies several issues that arise in practice.
Whistleblowers may submit information anonymously, but only through counsel, who must verify identity and submit the claim on their behalf. Waiting to retain counsel forecloses that option.
The rule also confirms that the program does not provide amnesty. A whistleblower who participated in the reported misconduct remains eligible for an award unless convicted of a criminal violation related to the covered action. Civil liability alone does not disqualify a whistleblower, though FinCEN may consider it in determining award amounts.
For whistleblowers who have already submitted tips, FinCEN will use the first submission date without requiring resubmission. Any award applications submitted before the rule’s effective date must be resubmitted using Form WB-APP through the agency’s new online portal once the rule is finalized.[4]
FinCEN will adopt the rule after a 60-day comment period, during which all interested parties, including whistleblowers and their counsel, may provide feedback. The comment period ends June 1.
FinCEN Clarifies Enforcement Priorities
FinCEN’s recent statements identify the types of violations it expects whistleblowers to report. In a February 2026 bulletin, the agency outlined a range of misconduct within its enforcement focus.[5]
These include failures by financial institutions to detect and prevent fraud-related money laundering, to conduct adequate customer due diligence, to maintain effective controls to detect structuring activity, and to identify and investigate investment scams. FinCEN also pointed to failures to detect falsified trade documentation used to conceal ties to sanctions jurisdictions or individuals.[6]
These priorities reflect a focus on foundational compliance failures, and are the type of misconduct that often develops within institutions over time and may not be visible to regulators.
FinCEN reinforced that message in a March 30 press release announcing the proposed rule. Bessent stated that Treasury will “reward whistleblowers who provide timely, actionable information on fraud, sanctions violations, and other significant illicit finance activity” and that Treasury “strongly encourage[s] individuals to come forward with credible tips to help safeguard our financial system.”[7]
The Canaccord Action Demonstrates FinCEN’s Enforcement Priorities
The proposed rule comes just weeks after FinCEN imposed a record $80 million penalty against Canaccord Genuity LLC for BSA violations tied to underlying securities fraud.[8] The penalty, the largest ever imposed on a broker-dealer, provides a clear example of FinCEN’s priorities in practice.
According to FinCEN’S consent order, Canaccord, acting as a market maker, failed to maintain an AML program commensurate with the risks of its business. The firm’s compliance shortcomings were extensive. It did not conduct adequate customer due diligence, failed to file at least 160 suspicious activity reports related to over-the-counter securities transactions and did not have sufficient staff to handle transaction volumes. As a result, it failed to detect or report securities fraud schemes that harmed investors.
Equally significant is Canaccord’s failure to remediate these known issues. The consent order states that regulators had previously identified weaknesses in transaction monitoring, and Canaccord committed in writing to remediate them, but it did not take any meaningful action until FinCEN launched its own investigation.
FinCEN Director Andrea Gacki described the action as “a wake-up call to broker-dealers that willfully fail to comply with their obligations to safeguard the financial system from illicit actors.”[9]
The size of the penalty highlights FinCEN’s willingness to impose significant sanctions, particularly in cases where firms fail to meet core AML obligations.
While it is unknown whether a whistleblower was involved, it illustrates the financial stakes associated with reporting. Under the rule’s award structure, a recovery of this size could result in an award between $8 million and $24 million.
Practical Implications for the Industry and Whistleblowers
FinCEN is increasing its scrutiny of AML and sanctions compliance programs, with particular focus on firms that fail to meet core obligations or delay in addressing known issues. At the same time, the agency is creating strong incentives for employees and other insiders to report those failures directly to FinCEN. Institutions should treat AML compliance as mandatory and move quickly to address deficiencies identified internally or in examinations before they become the subject of an enforcement action.
Individuals with information about potential BSA or OFAC-administered sanctions violations should submit a tip promptly through FinCEN’s online portal to preserve the submission date. Attorneys advising individuals with potential exposure should address criminal risk, civil liability and eligibility to ensure submissions comply with the program’s requirements.
Conclusion
FinCEN’s proposed rule, reinforced by recent agency guidance and the Canaccord action, signals a meaningful escalation in AML and sanctions enforcement. FinCEN is building the infrastructure to reward whistleblowers and has the appetite to back it up. With the program moving toward its first awards, FinCEN has positioned whistleblowers to play a central role in its overall strategy.
Marlene Koury is a partner at Constantine Cannon LLP.
The opinions expressed are those of the author(s) and do not necessarily reflect the views of their employer, its clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.
[1] FinCEN, Anti-Money Laundering/Countering the Financing of Terrorism Whistleblower Program, 91 Fed. Reg. 16328 (Apr. 1, 2026).
[2] Anti-Money Laundering Act of 2020 (“AML Act”), Pub. L. No. 116-283, §§ 6101-6511, 134 Stat. 3388 (2021); Anti-Money Laundering Whistleblower Improvement Act, Pub. L. No. 117-263, div. F, tit. LXI, § 6102, 136 Stat. 2395 (2022).
[3] U.S. Dep’t of the Treasury, Treasury Launches Whistleblower Portal, (Feb 13, 2026), https://home.treasury.gov/news/press-releases/sb0394.
[4] U.S. Dep’t of the Treasury, online portal webpage, https://www.fincen.gov/whistleblower/.
[5] FinCEN, Whistleblower Bulletin: Blow the Whistle on Fraud-Related AML and Sanctions Violations (Feb. 2026), https://www.fincen.gov/system/files/2026-02/owb-whistleblower-bulletin.pdf.
[6] Id.
[7] FinCEN press release, FinCEN Proposes Rule to Pay Whistleblowers (March 30, 2026), https://www.fincen.gov/news/news-releases/fincen-proposes-rule-pay-whistleblowers.
[8] FinCEN, In re Canaccord Genuity LLC, Assessment of Civil Money Penalty No. 2026-01 (2026).
[9] FinCEN, FinCEN Assesses Historic $80 Million Penalty Against Canaccord Genuity LLC (Mar. 6, 2026), https://www.fincen.gov/news/news-releases/fincen-assesses-historic-80-million-penalty-against-canaccord-genuity-llc.
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