Employees with boots on the ground and direct insight into a company’s day-to-day operations and internal decision-making often know a company best. Often, they possess far more actionable information than regulators ever could. California is looking to capitalize on that knowledge by proposing a whistleblower incentive program for the California Consumer Privacy Act. If passed, AB 2021 (the Act) would offer whistleblowers financial incentives for reporting potential violations and would prohibit retaliation against them.
Financial Incentives
Under the Act, whistleblowers will be required to submit complaints to the California Privacy Protection Agency (CalPrivacy) for investigation. If CalPrivacy designates a complaint for administrative enforcement and it leads to a penalty or settlement, a whistleblower can receive between 15 percent and 33 percent of fines collected. Additionally, the Act requires whistleblowers to be represented by counsel but permits CalPrivacy to assess additional administrative penalties to cover the whistleblower’s reasonable attorneys’ fees. Whistleblowers are also allowed to submit complaints anonymously through counsel.
The US Securities and Exchange Commission’s (SEC) whistleblower program follows a similar regime and has seen success in incentivizing whistleblowers. In a 2025 report to Congress, the SEC reported it received approximately 27,000 whistleblower tips and made whistleblower awards totaling more than $60 million to 48 individuals....
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