New York (HedgeCo.Net) – The SEC filed a “friend-of-the-court” brief, arguing that whistleblowers are entitled to protection from employer retaliation, even if they report the wrongdoing only to their employer and not to the SEC. The SEC stated that a whistleblower need not have reported wrongdoing to the SEC to avail himself of Dodd-Frank’s anti-retaliation protections.
In 2013 the SEC awarded more than $25,000 combined for tips and information that three whistleblowers provided to help the SEC and Justice Department stop a sham hedge fund.
The WSJ reports that: “Companies have recently pushed back against those rules, arguing in court that individuals have to report suspected wrongdoing to the agency to qualify for whistleblower protection and that those who report internally only don’t make the cut. This would narrow the pool of individuals who can sue a firm over alleged retaliation.”
“The Commission’s whistleblower program both encourages whistleblowers to report wrongdoing and protects them when they do. Today’s filing makes clear that under SEC rules, whistleblowers are entitled to protection regardless of whether they report wrongdoing to their employer or the Commission.” Sean McKessy SEC Chief at the Whistleblower Office, said, “The Commission’s brief supports the anti-retaliation protections under the Dodd-Frank Act that I believe are critical to the success of the SEC’s whistleblower program.”
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