Customs Fraud, Wildlife Crime, and the Value of Whistleblowers

In late 2017, federal prosecutors in the Southern District of New York (considered one of America’s most important judicial districts) settled a case against Notations, a garment wholesaler. In a case originally brought by a qui tam relator (a.k.a. a whistleblower), Notations admitted to ignoring repeated warning signs that its Chinese importer was lying about the value of its imported goods to avoid paying customs fees. As a result, Notations has agreed to pay $1 million in fees.

While the Department of Justice did not release the portion of the award that went to the whistleblower, under the False Claims Act a whistleblower plaintiff is entitled to somewhere between 15% and 30% of the total reward.

The principles of this case can and should be applied to the wildlife crime context. As Stephen M. Kohn, Executive Director of the National Whistleblower Center, explained in his award-winning article, expanded use of wildlife whistleblowing could be a boon to animals and the environment. Criminal networks that import wildlife have been known to falsely label their animal products when they enter the country. This is a crime. Customs officials need to be trained to detect such fraud and prosecutors should seek to bring more wildlife crime cases.

The False Claims Act and other laws with whistleblowers provisions like the Lacey Act have the potential to be powerful tools for unearthing wildlife crime. NWC, as a part of its mandate as a Grand Prize Winner of the Global Crime Tech Challenge, is promoting the existence of these reward laws and has a global wildlife program to inform wildlife whistleblowers of their rights.

The Notations case demonstrates how falsified customs documents, whistleblowers, and the False Claims Act intersect. The next frontier for such cases should be wildlife crime.

Read the full DOJ press release here.