The Bernie Madoff scandal shed light on the shortcomings of the SEC’s whistleblower policies. Some have suggested that their whistleblower policy should more closely mirror the program of the IRS, which many find to be a successful tool in combating tax fraud. The Dodd-Frank Act has provisions to enhance the SEC’s whistleblower protections. It also adds incentive for anyone who has something to report by expanding the bounties whistleblowers can receive. The SEC outlined their new rules and the public can comment on the proposed rules until December 17th. If you are interested in commenting on these rules you can do so at the SEC’s Public Comment page.
The Wall Street Journal reported on this yesterday and pointed out that “companies fear the program, created by the Dodd-Frank financial law, will undermine the anonymous hotlines and other processes they have put in place following the 2002 Sarbanes-Oxley law to encourage employees to report problems internally.” To address this, the proposed rules do add provisions for people who initially report wrongdoing internally and contact the SEC within 90 days.
Interested in learning more about Dodd-Frank and what it means to your organization? You can check out PLI’s one hour briefings on the subject. Or, check out our latest publication entitled Dodd-Frank Wall Street Reform and Consumer Protection Act–A Summary.
Book Information: Dodd-Frank Wall Street Reform and Consumer Protection Act–A Summary
ISBN Number: 978-1-4024-1508-1
Number of Volumes: 1
Page Count: 93 pages