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America Needs More Tech Whistleblowers: Protecting Our Digital Future

by | January 13, 2025 | Whistleblower Law

By Elise Hasseltine and Taja Nadeau

The digital economy has become a sophisticated battleground where technological innovation thrives alongside increasingly complex fraud schemes. While technology has transformed business practices, it has also opened the door to unprecedented opportunities for misconduct across industries. In this challenging environment, having strong legal guidance is essential for uncovering fraud, holding perpetrators accountable, and protecting the integrity of the market.

The Landscape of Digital Deception

As highlighted in Part I of our blog series, “Why Doesn’t the Government Bet Bigger on Fraud?”, the Government Accountability Office reviewed a recent five-year period and estimated the country’s annual losses due to fraud to range between $233 billion and $521 billion. In the digital world, these losses may emerge through various illicit mechanisms. Some examples include:

  • Digital Advertising Fraud: Your company may be involved in creating fraudulent digital advertising schemes. For example, you may be witnessing tactics that trick advertisers into paying for clicks or impressions that don’t actually happen. A recent industry report showed how these schemes cost businesses billions annually through methods like:
    • Bot-driven engagement
    • Domain spoofing
    • Impression inflation
  • Dynamic Pricing Exploitation: Artificial intelligence algorithms may be employed by your company to implement predatory pricing strategies, raising concerns about fair market competition such as antitrust violations. On the consumer side, these algorithms could leverage behavioral data and predictive modeling to push higher prices on vulnerable customers, exploiting their lack of alternatives. In digital advertising, AI can distort pricing structures, obscuring transparency and creating unfair advantages that hinder market competition.
  • Cryptocurrency Risks and Scams: The decentralized, borderless nature of digital currencies makes them a prime target for fraud and illicit activities. Keep in mind that many of these crypto-related fraud schemes simply mimic traditional fraudulent schemes, such as Ponzi schemes, stolen logins, and catfishing, which continue to affect users in the digital space.
    • Escalating Risk with Fintech: If you are employed at a non-bank financial institution, be aware that your company may not have the infrastructure or insurance coverage to handle the growing volumes of investments. This lack of preparation could lead to serious issues down the line. Crypto exchanges and other fintech companies are particularly vulnerable to liquidity runs, and these events may become a regular, escalating risk within the industry.
  • Banking Manipulation: Financial technologies may be utilized by your company to take advantage of consumers through various methods, including:
    • Hidden transaction fees
    • Unauthorized account surcharges
    • Algorithmic fee structures designed to maximize institutional revenue
  • Personal Identifiable Information (PII): Your company may be involved in collecting and selling your PII without consent. This deceptive practice can result in unauthorized transactions, exposing consumers to significant privacy and financial risks.
  • Cybersecurity Negligence: Your company may be failing to protect its digital infrastructure, putting sensitive information at risk. This neglect not only compromises operational efficiency, but also creates a chain of risks that could result in catastrophic economic and personal consequences.
  • Business to Business (B2B) Algorithmic Manipulation: Manipulative algorithms in B2B contexts can be weaponized to inflate costs and suppress competition, creating artificial barriers that distort fair market practices. These algorithms exploit data-driven insights to reinforce monopolistic tendencies, making it harder for businesses to compete on equal footing.

Why Are Tech Whistleblowers So Important?

In today’s rapidly evolving tech world, whistleblowers have a unique and powerful role in exposing unethical practices that regulatory agencies may miss due to a lack of insider information. If you have direct knowledge of how software, algorithms, or digital systems at your company are misused, you could play a critical part in holding tech companies accountable. Below are some ways you, as a tech whistleblower, can make a difference to uncover fraud and earn a financial reward for your efforts:

  • Provide proof of manipulation: If you have evidence of algorithmic or system manipulation, your tip to regulators can help expose practices that harm consumers or the broader market.
  • Identify security vulnerabilities: Your whistleblower tip could expose weaknesses in digital security systems that endanger the public, prompting companies to take action and address these issues before they lead to greater harm.
  • Drive real change: By sharing your knowledge with the government, you can help shape new regulations that protect consumers, ensure fairness, and hold tech companies accountable.

Experienced Legal Representation: Your Rights, Your Voice

At Sanford Heisler Sharp McKnight, our Whistleblower and Qui Tam Practice Group, led by Co-Vice Chairman Vince McKnight, combines deep legal experience with innovative strategies to address fraud in the ever-evolving digital economy. As Chairman of the Board of Directors for The Anti-Fraud Coalition (TAF), Vince ensures that our practice group is at the forefront of whistleblower advocacy, empowering insiders to expose manipulative algorithms, cybersecurity vulnerabilities, and other critical fraud mechanisms that often evade external regulators.

We have a proven track record of securing substantial financial recoveries and holding bad actors accountable. As a whistleblower, you can trust us to provide the legal support you need to expose misconduct, protect public trust, and create real change in the tech industry.

Take the First Step: Confidential Consultation

If you have knowledge of fraud in technology, banking, or digital advertising and believe you may have a whistleblower claim, please complete our online intake form to speak with a whistleblower attorney at Sanford Heisler Sharp McKnight today.

 

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