Four Key SEC Whistleblower Trends—And How Companies Can Prepare For Them

Four Key SEC Whistleblower Trends—And How Companies Can Prepare For Them

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WilmerHale has defended clients in hundreds of class, derivative, shareholder and individual actions alleging securities fraud, breach of fiduciary duty and other corporate misconduct.
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WilmerHale has defended clients in hundreds of class, derivative, shareholder and individual actions alleging securities fraud, breach of fiduciary duty and other corporate misconduct.

An article by Matthew Martens, Arian June and former Associate Caroline Schmidt, published in The Review of Securities & Commodities Regulation, discusses ongoing trends in the Securities and Exchange Commission's whistleblower program including: (1) increasing whistleblower bounties; (2) awards for mid-investigation tips; (3) use of the more lenient “objectively reasonable” standard for whistleblower protection from retaliation; and (4) the SEC's focus on confidentiality agreements.

The US Securities and Exchange Commission has issued a rapid succession of high-dollar whistleblower awards in recent weeks that are certain to gain the attention of potential corporate whistleblowers. The SEC's Whistleblower Program financially rewards individuals who “voluntarily provide the SEC with unique and useful information that leads to a successful enforcement action.”1 Since the Commission launched the program in 2011, the agency has awarded 32 whistleblowers more than $85 million dollars.2 Nearly a third of that amount has been awarded in the weeks since May 2016. Read the full article

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