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In 2014, scientists at West Virginia University brought to light a Volkswagen emissions cheating scandal that involved 11 million diesel-powered automobiles. As a result of the university’s investigation, Volkswagen admitted to deliberate cheating, which led to multiple class-action lawsuits, $2.8 billion in criminal fines imposed by the U.S. government, and a total cost to the company of more than $30 billion globally, including car buybacks and settlements. The Volkswagen ?Dieselgate? scandal eventually led to significant legal consequences for top leadership in Germany.

Whistleblower reward laws are designed to incentivize insiders to expose corporate fraud by offering a bounty. In the U.S., agencies such as the Securities and Exchange Commission and laws such as the False Claims Act typically grant whistleblowers 10 to 30 percent of the total fines collected. These rewards help offset the significant professional and personal risks faced by those who come forward.

Are universities and their scientists eligible to receive rewards like those that whistleblowers who expose fraud receive? Only in limited circumstances. Even when successful, it’s a challenging process that may, for example, involve the need to file a lawsuit, and so discourages scientists from participating. Yet, WVU and its researchers did a tremendous public service, and in order to encourage other universities to do the same, we should change the whistleblower statutes to help them access a share of the fines paid to the government for such egregious public cheating and fraud.

Since the passage of the Clean Air Act in 1970, major manufacturers of cars, trucks, and heavy equipment have been caught using ?defeat devices,? which combine sensors and software to increase fuel mileage by emitting more dirty exhaust than allowed. Engineering a car that can comply with clean air regulations without decreasing its fuel efficiency can add substantially to the car’s price and make it less competitive in the cutthroat global automobile markets.

Whistleblower reward laws are designed to incentivize insiders to expose corporate fraud by offering a bounty.

Cheating on automobile emission control is a systemic problem. Over the years, auto manufacturers including Ford, Honda, General Motors, and Volkswagen have paid hefty fines and were forced to recall vehicles after getting caught using defeat devices.

The fines can be substantial. General Motors agreed to pay $45 million as part of a settlement over defeat devices installed in Cadillacs in the 1990s. Ford agreed in the 1990s to spend millions on fines and fixes after defeat devices were discovered on about 60,000 of the company?s Econoline vans. At the same time, Honda paid some $267 million in fines because of use of emission cheating devices on more than 1.6 million Civics and other models built in the 1990s. The U.S. Justice Department and Environmental Protection Agency took steps in the 1990s against manufacturers of diesel engines used in trucks and earth-moving equipment after defeat devices were discovered. Companies including Caterpillar, Cummins Engine, Mack Trucks, and what was then called Volvo Truck Company agreed to pay more than $1 billion to settle the charges, including more than $80 million in fines.

Scientists from the University of California, San Diego and Ruhr University Bochum in Germany wrote an extensive paper on the Volkswagen cheating device. They call the modern automobile a “cyber-physical” system. Its computer has 100 million code lines, and any discovery of cheating by inspecting the emission control software could seem hopeless without a large team working on this problem for years.

Why not empower universities, who have the know-how and labs, to go after large frauds in pursuit of the public interest and large rewards?

Often, more than one whistleblower is involved, so the reward is divided. In one notable case, $102 million was divided between a group of six employees for having exposed the illegal promotion of Pfizer’s arthritis drug Bextra. In a case involving Abbott Laboratories, whistleblowers stood to receive about $84 million under the False Claims Act in a settlement concerning off-label promotion of the anti-seizure drug Depakote, for which Abbott paid a $1.5 billion fine.

In most cases, whistleblowers are employees of the offending companies. The general public, however, does not have the privilege of discovering such cheating. Moreover, regulatory agencies such as the Environmental Protection Agency and the Food and Drug Administration, as well as the Internal Revenue Service, are understaffed and underfunded. Why not empower universities, who have the know-how and labs, to go after large frauds in pursuit of the public interest and large rewards? New laws and regulations would be needed.

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Let’s incentivize universities to become a sort of Ralph Nader. Biochemists and biologists can take samples to their labs and inspect beef and chicken meat that is supposedly raised on antibiotic-free animal food. Pharma chemists can analyze new drugs in their labs to verify their properties. These would necessarily be side projects, fueled by personal initiative and pooled expertise, rather than formal funding mechanisms. Universities could arrange for an award to be divided in a way similar to that of patent royalties between a university and its scientists.

As an example, we can consider the dollar amount that the government might have paid for the discovery of the Volkswagen cheating. The criminal fines were $2.8 billion, so, for example, a 16 percent whistleblower award comes to $448 million. If this award had been divided 50-50 between WVU and its scientists and engineers, the university would have received $224 million, and each researcher could have received about $45 million before taxes. Revealing such fraud could become a new line of research for universities that would provide tremendous public service and bring much needed funding for further research.

Moshe Alamaro is a retired research scientist at MIT’s Department of Earth, Atmospheric, and Planetary Sciences. His writing has appeared in Global Policy, Middle East Policy, World Affairs, IEEE Technology and Society, Nature, and Harvard Business Review, among others.

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