Recent SEC, CFTC Announcements of Whistleblower Payouts
- posted: Jun. 20, 2016
- Whistleblower Litigation
In recent years, the federal government has ramped up efforts to fight corruption in corporate settings, with whistleblowers receiving more protection and rewards for uncovering malevolent schemes within businesses and organizations. Thus, individuals have far more reason to come forward and reveal wrongdoing than ever before.
The following are a few recent announcements made by the Securities and Exchange Commission (SEC) and Commodities Futures Trading Commission (CFTC) that highlight some recent successes in each agency’s whistleblower program:
- On March 8, the SEC announced awards worth nearly $2 million to three whistleblowers. The largest of the three awards, worth $1.8 million, was provided to a person who voluntarily stepped up to provide information that led to a successful investigation. The other two whistleblowers provided valuable information after the investigation began, and were awarded $65,000 each for their assistance.
- On January 15, the SEC announced that, for the first time ever, it would provide an award to a person not employed by a company for providing information that led to a successful enforcement action against that company. The award was worth more than $700,000.
- On April 4, the CFTC announced an award of $10 million — by far the largest of the three awards handed out so far under that program. The person who received the award gave the agency “original information” that led to the successful enforcement. The previous two awards had only been worth $240,000 and $290,000, respectively.
The SEC and CFTC also commended lawmakers for new legislation issued in the realm of whistleblower law. The Whistleblower Augmented Reward and Non-Retaliation Act of 2016 expands protections for individuals who blow the whistle on financial crimes.
With these extra incentives for potential whistleblowers, it’s more important than ever for businesses and organizations to protect themselves. For further guidance, contact an experienced Dallas attorney at Whistleblower Law for Managers.
