Dodd-Frank whistleblower program

gavelapril2013It will not come as news to anyone that corporate directors face the possibility of direct personal liability for their actions or omissions in the capacities as directors. However, the scope of these individuals’ potential liability exposures can and does change. As a result of recent legal developments, at least two new areas of potential liability exposure for corporate directors have emerged. As discussed below, a recent federal district court decision suggests that directors can be held personally liable under both the Sarbanes-Oxley Act and the Dodd-Frank Act for whistleblower retaliation, and a recent California legislative enactment provides that corporate directors can be held personally liable for violations of the state’s wage and hour laws.
Continue Reading New Dimensions in Director Liability Exposure

seclogoThe number of whistleblower reports to the SEC’s Office of the Whistleblower under the Dodd-Frank Act’s whistleblower provisions continues to increase, according to the agency’s latest annual report. The November 16, 2015 report, which is entitled “The 2015 Annual Report to Congress: Dodd-Frank Whistleblower Program,” and which can be found here, reports that the number of whistleblower reports to the agency has increased every year since the program was instituted in 2011. The agency has also made over $54 million in whistleblower awards since the program’s inception, including more than $37 million to eight whistleblowers in fiscal year 2015 alone.
Continue Reading SEC Whistleblower Reports Continue to Increase

seclogoWhile the SEC’s Dodd-Frank whistleblower program has drawn significant attention, the fact is that the program has gotten off to a slow start. As of the end of the last fiscal year, the SEC had during the program’s history received a total of 10,193 whistleblower reports, but had made only 14 whistleblower awards. (Indeed, the agency had rejected more award requests – 19 – than awards given.) While the agency’s deliberate pace in making awards seems unchanged, the agency continues to make substantial awards and the aggregate value of the awards is gradually becoming quite considerable.

On July 17, 2015, the SEC announced yet another significant award, a $3 million award to a company insider whose information “helped the SEC crack a complex fraud.” Consistently with the law’s requirements, the agency did not disclose the name of the whistleblower or the company involved. The SEC’s July 17, 2015 press release can be found here. The redacted July 17, 2015 SEC Order determining the whistleblower award can be found here.
Continue Reading Is the Dodd-Frank Whistleblower Bounty Program Gaining Momentum?

sec sealThe number of whistleblower reports to the SEC increased again in the latest fiscal year, according to the annual report of the SEC whistleblower office. The report, which the SEC is required by the Dodd-Frank Act to provide to Congress annually, is entitled the “2014 Annual Report to Congress on the Dodd-Frank Whistleblower Program” and

secondsealIn the latest fiscal year report of the SEC Office of the Whistleblower, the agency reported that as of the end of the 2013 fiscal year it had received  a total of 6,573 whistleblower reports since the the Dodd-Frank whistleblower program’s inception. These figures include not only domestic whistleblower reports but also reports from a

boeWhen Congress passed the Dodd-Frank Act four years ago, one of the legislation’s signature features was the creation of potentially massive bounties for whistleblowers that reported financial fraud to the SEC. The possibility of recovering a bounty, which could range from ten to thirty percent of recoveries over $1 million, seems to have encouraged whistleblowers

Whistleblower reports to the SEC continued to rise during the latest fiscal year, according to the agency’s annual Dodd-Frank Whistleblower Program report to Congress. According to the November 15, 2013 report, a copy of which can be found here, there were 3,238 whistleblower reports to the SEC during the 2013 fiscal year, brining the