The Securities and Exchange Commission’s (SEC) issuance of its highly anticipated rules implementing the bounty provisions of Dodd-Frank’s whistleblower framework (§ 922 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, now § 21F of the Securities Exchange Act of 1934) is imminent. This comes on the heels of a recent flood of employee complaints to the SEC.

Key subjects that the SEC’s final rules will address include:

  • The effect an internal complaint or lack thereof will have on the percentage of recovery for which a whistleblower may be eligible;
  • The “grace period” following an internal complaint that allows a whistleblower to keep his or her “place in line”;
  • Whether a whistleblower has “independent knowledge”;
  • What constitutes a “voluntary submission”;
  • What constitutes “original information”;
  • Limits on recovery by a whistleblower who engaged in misconduct;
  • Requirements for anonymous submissions; and
  • Protections against whistleblower retaliation.

We will provide a Management Alert when the SEC’s final rules are issued.

In addition, on April 28 we will deliver a webinar with EthicsPoint to explain the new rules, identify steps to avoid whistleblower claims, and provide techniques to defend against them. An invitation will follow and you will be able to register for the webinar through the invitation.