Case demonstrates the important role whistleblowers play in exposing illegal anticompetitive schemes.
In a significant development for antitrust enforcement, the U.S. Department of Justice’s Antitrust Division has issued its first whistleblower reward under the recently established Whistleblower Rewards Program. The government awarded $1 million to an individual whose information led to criminal charges, a deferred prosecution agreement, and a $3.28 million fine against EBLOCK Corporation, an international company operating an online auction platform for used vehicles.
How can I learn more about the DOJ’s Antitrust Whistleblower Rewards Program?
Dan Mogin of Mogin Law LLP recently teamed up with Julie Keeton Bracker of Bracker & Marcus to create an insightful and detailed webinar on the intricacies of the new program which explores the important nuances of establishing an antitrust case. Watch it here (no charge) or take it for CLE on the Cerifi LegalEdge Platform (subscription or fee required).
What was alleged in the first case brought under the DOJ’s Antitrust Whistleblower Rewards Program?
The case centers on EBLOCK’s acquisition of Company A in November 2020. Following the acquisition, EBLOCK failed to address ongoing anticompetitive practices at Company A, including a bid-rigging conspiracy with Company B and fraudulent “shill bidding” activities. These practices suppressed competition and artificially inflated prices for used vehicles, violating the Sherman Act and federal wire fraud statutes, the DOJ said. The scheme, which lasted until February 2022, reportedly cost consumers $16 million.
What did the whistleblower help establish?
The whistleblower’s report of EBLOCK’s conduct was instrumental in uncovering the conspiracy, which involved:
- Sharing confidential bidding information.
- Coordinating bids to limit competition.
- Using software to place fake bids under the names of legitimate auto dealerships without their consent.
- Splitting profits from the scheme, which relied on the U.S. Mail to facilitate fraudulent documentation.
How long has the DOJ’s Whistleblower Rewards Program been in effect?
The Antitrust Division’s Whistleblower Rewards Program, launched just six months ago, incentivizes individuals to report antitrust violations and related crimes. Whistleblowers who provide original information leading to criminal fines or recoveries of at least $1 million may be eligible for rewards ranging from 15 to 30 percent of the collected amount. Federal law also protects whistleblowers from retaliation and ensures confidentiality.
This case underscores the critical role whistleblowers play in exposing antitrust violations and protecting consumers from harmful practices. For businesses, it serves as a reminder of the importance of maintaining robust compliance programs and addressing anticompetitive conduct promptly.
