Who Can Be a Financial Fraud Whistleblower?

The Securities and Exchange Commission (SEC) has a Whistleblower Program that provides valuable assistance in the battle against financial fraud and offers payments to individuals whose reports result in monetary sanctions resulting from SEC violations. Though many investigations into financial impropriety involve complex subjects, one does not have to be an expert in the subject to be an effective whistleblower.

In truth, anyone with reliable evidence that their company is committing fraud on the government, investors, customers or the financial market at large can be a whistleblower. High executives such as CEOs, CFOs, sales directors, controllers and auditors often have access to information that leads to an SEC inquiry. On the other hand, sometimes lower-level employees of banks, investment firms, insurance companies and accounting firms learn about misconduct during the course of their work duties.

Individuals who invest in publicly traded companies or financial products might also become aware of fraudulent activities, such as accounting irregularities, insider trading or misleading disclosures. Investors who uncover financial fraud can also act as whistleblowers to report these violations. Many financial institutions also use third-party contractors, consultants or vendors who could have insight into fraudulent activities. They can also qualify as whistleblowers if they report financial fraud to the appropriate authorities.

If you have evidence of fraud by a bank or other financial institution, you have the right to confidentiality and anonymity when making your report. Federal and state laws, such as the Sarbanes-Oxley Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act, prohibit employers from retaliating against whistleblowers who report financial fraud.  

Whistleblowers who provide original information leading to successful enforcement actions may be eligible for financial rewards under the programs set up by the SEC or Commodity Futures Trading Commission. Financial fraud whistleblowers play a vital role in safeguarding the integrity of the financial system and protecting investors and consumers from harm. Whether you're an employee, investor, contractor or insider, if you have knowledge of financial fraud, you have the right to report it without fear of retaliation and may collect substantial payment for providing a valuable service to the government. 

At Kardell Law Group, we are here to provide guidance and support to financial fraud whistleblowers throughout the reporting process, ensuring their rights are protected and their voices are heard. Together, we can work toward a more transparent, accountable and ethical financial marketplace.