August 12, 2011
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.