For the past five years, the U.S. Securities and Exchange Commission (SEC) has run a program that offers monetary awards to any individuals who can provide useful information regarding a company’s wrongdoing. If these tips lead to SEC enforcement actions, the whistleblower could earn up to 30 percent of the total sanctions the agency levies — as long as the sanctions total more than $1 million.
The following are a few things you should know about this program:
- Filing is easy: The SEC’s Office of the Whistleblower website contains a simple six-page form asking for all the facts related to the alleged violation, why the claimant believes these acts should be classified as a violation and any additional information that could help process the action.
- The program has paid out big: The program has offered 37 awards since its inception, but over the last two years has provided record sums and taken more total actions. This is due both to a greater quality of leads and more widespread awareness of the program itself.
- More tips coming in: The program has encouraged would-be whistleblowers to report wrongdoing as soon as they discover it in their workplaces. Each year of the program’s existence has seen a greater number of tips coming through, which in turn has led to more successful enforcement actions. However, there is still just one award for every 500 tips that come in.
- Protections: Whistleblowers who file claims are protected under federal law from retaliation. If an employer does retaliate in any way, whether it is in the form of firing, demotion or poor treatment in the workplace, claimants may choose to report this activity. This could land the company in even greater legal trouble.
If you would like to serve as a whistleblower under the protections offered through the Dodd-Frank Act and other federal laws, speak with an experienced Dallas attorney at Whistleblower Law for Managers.