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Whistleblowing and self-reporting
Are whistleblowers protected in your jurisdiction?
Yes. Whistleblowers have both incentives and protections. The Securities and Exchange Commission (SEC) is authorised by Congress to provide monetary awards to eligible individuals who come forward with high-quality original information that leads to a Foreign Corrupt Practices Act action in which over $1 million in penalties is ordered. The range for awards is between 10% and 30% of the money collected. The Office of the Whistleblower was established to administer the SEC’s whistleblower programme. Retaliation against whistleblowers is prohibited by law, and the SEC has fined companies for such action, including:
- removing the whistleblower from his or her position;
- tasking the whistleblower with investigating the conduct that he or she reported to the SEC;
- changing the whistleblower’s job function;
- stripping the whistleblower of his or her supervisory responsibilities; and
- marginalising the whistleblower.
Is it common for leniency to be shown to organisations that self-report and/or cooperate with authorities? If so, what process must be followed?
Both the Department of Justice and the SEC provide the possibility of leniency for organisations that self-report and cooperate with the authorities. The decision of whether to disclose voluntarily is complex and fact dependent and has wide-ranging consequences that must be carefully considered. The primary Department of Justice policy is the Principles on Federal Prosecution of Business Organisations. In April 2016 the Department of Justice published a memorandum describing a Foreign Corrupt Practices Act pilot programme to encourage self-reporting and voluntary disclosure. The programme will be in effect until April 2017, unless extended. The SEC’s policy is contained in the Report of Investigation Pursuant to Section 21(a) of the Securities Exchange Act 1934 and the Commission Statement on the Relationship of Cooperation to Agency Enforcement Decisions, commonly known as the ‘Seaboard Report’.
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