Thursday, August 18, 2011

Industry groups to challenge SEC whistleblower rules?

The New York Times reports that financial trade groups are considering suits challenging the Securities & Exchange Commission's new whistleblower program.

A July ruling by a federal appeals court striking down a new proxy-access rule has emboldened industry groups that want to undermine the regulations that have been issued pursuant to Dodd-Frank.

Rather than relying on lobbying, which might occasionally gain them a loophole, the financial industry hopes that judicial rulings will halt rules altogether.

The whistleblower program is not the only aspect of Dodd-Frank regulations being eyed by banks and corporations. Rules governing oil and gas extraction in foreign countries are also under attack.

The SEC is reportedly considering an appeal of the proxy ruling. And according to the article, the Commodity Futures Trading Commission is evaluating whether to adjust its "proposed regulations." The CFTC itself presents these rules as final but has not yet published them in the Federal Register. That publication is required before the rules can go into effect.

Monday, August 15, 2011

CFTC approves whistleblower rules

The Commodities Futures Trading Commission approved new rules for the whistleblower program by a vote of 4-1 on August 4. The vote was postponed from the July 19 meeting.

The CFTC announced that the final whistleblower rules will be substantially the same as the proposed rules. They will take effect no later than 60 days after their publication in the Federal Register, but they have not yet been published there.

Friday, August 12, 2011

New SEC whistleblower program opens today

The SEC whistleblower program outlined by the Dodd-Frank Wall Street Reform and Consumer Protection Act has officially gone into effect today.

Whistleblowers who provide “new and timely” information on securities law violations can now receive a portion of any sanction over $1 million. The SEC Whistleblower office has also launched a new website to help potential whistleblowers understand the process of submitted a tip and applying for an award.

Since the Dodd-Frank rule went into effect on July 21, 2010, the SEC says that 170 actions have resulted in sanctions of more that $1 million. As the Whistleblower program was not effective at that time, persons who believe that they contributed valuable information to one of those actions are invited to apply for whistleblower awards.

The SEC claims that since the implementation of the Dodd-Frank rule, the quality of information that they have received from tipsters has improved. Before Dodd-Frank, the SEC was only authorized to pay whistleblowers for sanctions caused by insider trading. The new program also boasts improved “protections against retaliation” from employers.