The Car and Truck Fleet and Leasing Management Magazine

Bill Proposes Incentives for Auto Industry Whistle Blowers

December 08, 2014

THUNE
THUNE

A new U.S. Senate bill proposes giving auto industry employees financial incentives to voluntarily inform the U.S. Department of Transportation about faulty products that pose a public safety threat.

In the wake of this year’s record-setting vehicle safety recalls, senators John Thune (R-S.D.) and Bill Nelson (D-Fla.) recently introduced legislation that would allow auto industry whistleblowers to receive up to 30 percent of the monetary penalties arising from a DOT or Justice Department enforcement action that totals more than $1 million.

The financial incentives would be available to employees or contractors of automotive manufacturers, parts suppliers and dealerships. The product information provided must be previously unknown to the DOT secretary. The revelation also must be related to a motor vehicle defect, noncompliance or any reporting violation that’s likely to result in risk of death or serious injury.

The bill has been referred to the Senate Committee on Commerce, Science and Transportation. Thune is in line to become the Commerce Committee chairman, while Nelson is expected to become the ranking member. Senators Claire McCaskill (D-Mo.) and Dean Heller (R-Nev.), the leaders of the Commerce Committee’s subcommittee on consumer protection, are cosponsors of the bill.

“By encouraging employees in the auto sector to speak up about auto safety problems, we can help prevent injuries and even deaths for American drivers,” Thune said. “This bill will ensure that more Americans are aware of faulty parts in their vehicles sooner and [will] better protect the traveling public.”

“It took years for problems with faulty ignitions and defective airbags to fully come to light,” added Nelson. “If ever there was a time to encourage industry insiders to speak out, it is right now.”

The Thune-Nelson bill will take into account whether the whistleblower had opportunity to report the problems internally, as well as the significance of the information. It will also protect whistleblowers’ identities.

The legislation is modeled after existing statutory whistleblower protections that encourage individuals to share information with the Internal Revenue Service and the Securities and Exchange Commission.

“In my experience as an auditor, and in my work to boost accountability and oversight of government, whistleblowers are absolutely critical to rooting out waste, fraud and misconduct,” McCaskill said. “This is a commonsense, bipartisan effort that we should all be ready to get behind to keep drivers safe and better protect American consumers.”

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