By Jeffrey M. Haber On January 6, 2017, the SEC announced that it awarded $5.5 million to a whistleblower who came forward with information that led to a successful SEC enforcement action. The whistleblower is the 38th relator to receive an award under the SEC whistleblower program. In total, since 2011, the SEC has paid approximately $142 million to whistleblowers who provided information resulting in the collection of monetary sanctions against violators of the securities l

By: Jeffrey M. Haber The Securities and Exchange Commission (“SEC” or “Commission”) has put a lump of coal in the Christmas stockings of two companies this week for using separation agreements that impede the ability of whistleblowers to report violations of the securities laws to the Commission. The announcements by the SEC (here and here) came within a day of each other and evidence a continued resolve by the Commission to crack down on companies that use severance agreemen

By Jeffrey M. Haber Over the year, this Blog has written about awards given to whistleblowers under the SEC and CFTC whistleblower programs – the anti-fraud/anti-corruption programs created under the Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank Act”). See here, here, here, here, and here. As this Blog previously reported, on December 5, 2016, the SEC announced that it had awarded $3.5 million to a whistleblower who came forward with informati

The Securities and Exchange Commission (“SEC”) will tell anyone who listens that reporting violations of the securities laws is an important part of its anti-fraud/anti-corruption whistleblower program. This is especially so when the violations are difficult to detect. For this reason, among others, the SEC has encouraged company insiders with knowledge of wrongdoing to come forward with information about the violations. The carrot used to encourage such whistleblowing is the

By Jeffrey M. Haber What is the amount of fines assessed by FINRA this year? Thus far, 2016 has been a banner year for the Financial Industry Regulatory Authority ("FINRA"). Buoyed in part by a handful of large penalties, the self-regulatory watchdog is on pace for a record year as fines could be up by 70 percent when all is said and done. In the first six months of this year, FINRA assessed $79.4 million in fines against member broker-dealers. For the similar period in 2015

On November 14, 2016, the Securities and Exchange Commission (“SEC”) announced that it had awarded more than $20 million to a whistleblower “who promptly came forward with valuable information that enabled the SEC to move quickly and initiate an enforcement action against wrongdoers before they could squander” their ill-gotten gains. The award “is the third-highest since the SEC’s whistleblower program issued its first award in 2012.” To date, the SEC has paid “more than $130

The SEC’s Findings On September 28, 2016, one day before the Securities and Exchange Commission (“SEC”) announced its first stand-alone action to enforce Section 21F(h) of the Securities Exchange Act of 1934 (discussed on this Blog here), the SEC settled with Anheuser-Busch InBev SA/NV (“AB InBev”) for its alleged violations of the Foreign Corrupt Practices Act (“FCPA”) and the anti-retaliation provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Pursu

On September 29, 2016, the Securities and Exchange Commission (the “SEC” or the “Commission”) announced that International Gaming Technology (“IGT”), a casino-gaming company, agreed to pay $500,000 to settle charges of retaliating against one of its executives with several years of positive performance reviews because he reported to senior management and the SEC concerns about the accuracy of IGT’s financial statements. According to the SEC’s order, within weeks of raising co

On September 14, 2016, Andrew Ceresney (“Ceresney”), Director, Division of Enforcement of the Securities and Exchange Commission (the “SEC” or “Commission”), spoke at the Sixteenth Annual Taxpayers Against Fraud Conference in Washington, D.C. Ceresney covered a lot of ground during his presentation, addressing issues such as the impact of the whistleblower program to the role of whistleblowers and their attorneys in the investigation and claims process. Impact of the Whistleb

By Jeffrey M. Haber On September 20, 2016, the Securities and Exchange Commission (“SEC”) announced that it awarded more than $4 million to a whistleblower who provided original information about a fraud that resulted in the recovery of monetary sanctions. Since 2011, the SEC has awarded more than $111 million to 34 whistleblowers pursuant to the agency’s whistleblower program. The SEC did not identify the whistleblower. By law, the SEC protects the confidentiality of whistl

By Jeffrey M. Haber On August 30, 2016, the Securities and Exchange Commission (“SEC”) announced that it awarded a company insider $22.5 million for providing “detailed” information about a “well-hidden fraud at the company where the whistleblower worked.” Though not disclosed by the SEC, news outlets reported that the company involved was Monsanto Co. The $22.5 million award is the second-largest the SEC has awarded a whistleblower since the program’s inception in 2011. Amo

By Jeffrey M. Haber, a partner at Freiberger Haber LLP On September 1, 2016, the Commodity Futures Trading Commission (“CFTC” or the “Commission”) announced that it was seeking comment on proposed amendments to the rules governing the Commission’s whistleblower program, its authority to administer the program and issue whistleblower awards, and its authority to implement anti-retaliation enforcement measures. The amendments, if adopted, will make the CFTC’s whistleblower prog

By Jeffrey M. Haber How many awards has the Commodity Futures Trading Commission ("CFTC") made under its whistleblower program? The CFTC awarded a whistleblower $50,000, the second such award this year. The $50,000 award comes on the heels of a $10 million award earlier in 2016, the largest award under its program to date. Authority Under the Dodd-Frank Act The whistleblower award program created under the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank

By: Jeffrey Haber In 2010, Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act” or the “Act”) to combat illegal and fraudulent conduct on Wall Street and promote compliance with the federal securities. The Dodd-Frank Act contains whistleblower provisions that authorize the Securities and Exchange Commission (“SEC” or the “Commission”) to pay substantial cash rewards to whistleblowers that voluntarily provide the SEC with informa

What are the requirements to obtain a monetary award under the SEC Whistleblower Program? In June, the Securities and Exchange Commission ("SEC") announced its second largest whistleblower award of more than $17 million to a former financial services employee (the largest award of $30 million was awarded in 2014). This bounty comes after the SEC issued two awards in May. The securities watchdog continues to see a significant uptick in whistleblower claims. "The information a

Do mandatory arbitration clauses prevent class action lawsuits? The Consumer Financial Protection Bureau recently proposed a rule that would scale back mandatory arbitration clauses used by banks and other financial firms to limit their exposure to legal liabilities. While the new rule continues to allow arbitration in cases pursued by individual consumers, class actions would no longer be prevented. “Many banks and financial companies avoid accountability by putting arbitra