The Foreign Corrupt Practices Act (“FCPA” or “the Act”) (15 U.S.C. §§ 78dd-1, et seq.) is a 1977 federal statute passed to enhance financial transparency among American companies. The FCPA was passed in response to investigations conducted by the Security and Exchange Commission (“SEC”) in the early 1970’s that found bribery directed towards foreign [...]
Congress passed the Sarbanes-Oxley Act of 2002 (also known as “SOX” and the Corporate Responsibility Act of 2002) in response to high-profile financial scandals in the early 2000s involving publicly traded companies such as Tyco, WorldCom and Enron, which called into question the trustworthiness of corporate financial statements. Its goal is to help protect investors from [...]
Section 21F of the Securities Exchange Act of 1934 (“Exchange Act”) (15 U.S.C. §78u-6), entitled “Securities Whistleblower Incentives and Protection,” (often referred to as the SEC Whistleblower Statute) requires the Securities and Exchange Commission (the “Commission”) to pay awards, subject to certain limitations and conditions, to whistleblowers who provide the Commission with original information [...]
What is the False Claims Act Alternative Remedy Provision? When a relator brings a false claims action in the name of the Government under the False Claims Act ("FCA"), the Government may elect to pursue its claim through any alternate remedy available to the Government, including any administrative proceeding, to determine a civil money penalty. If any such [...]
Fifth Court Differentiates Whistleblower Protection If Whistleblower Reports to SEC or Internally to Company The Fifth Circuit ruled on June 17, 2013, that anti-retaliation provisions in Dodd-Frank only protect whistleblowers who disclose alleged fraud to the U.S. Securities and Exchange Commission ("SEC") and not just internally to the company. The case is Asadi v. GE [...]
The SEC Whistleblower Program & Foreign Corrupt Practices Act The SEC Whistleblower Program provides monetary incentives for individuals to come forward and report possible violations of the federal securities laws to the SEC. The SEC Whistleblower Program also incorporates violations of the Foreign Corrupt Practices Act ("FCPA") as reportable misconduct to the SEC. The reason the SEC enforces [...]
Securities and Exchange Commission Whistleblower Statute In response to the global financial crisis in 2008, Congress passed financial reform legislation known as the Dodd-Frank Act in 2010, which came into effect in August 2011. In addition to the sweeping new financial regulations, the Dodd-Frank Act contained whistleblower provisions to encourage and incentivize any natural person (not [...]
The SEC Whistleblower Statute and Statute of Limitations In July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law by President Obama. Section 922 of the Act states that the SEC will be required to pay a reward to individuals who provide original information to the SEC resulting in monetary sanctions exceeding $1 million [...]
SEC Chairwoman Marry Jo White in a speech on April 30, 2015 noted that “[t]he program, while clearly developing, has proven to be a game changer.” White noted the increasing volume and quality of tips as well as the powerful incentives to come to the SEC with evidence of wrongdoing. Read the full transcript [...]
Whistleblowers with knowledge of possible securities fraud are able to report this fraud confidentially under the relatively new whistleblower provisions of the 2010 Dodd Frank Act. If an employee opts to report the information directly to the government, he or she is thereafter protected from retaliatory maneuvers by the employer and can even seek [...]
