“Reporting fraud should be rewarding, not punitive.”
We make that comment on our website at the proven whistleblower-defense law firm of Hilder & Associates in Houston.
It is a logical statement to us, given the clear benefits realized for government investigators and a defrauded public whenever an individual comes forward with material information concerning financial wrongdoing. Individuals who know something about that often take great personals risks (to their careers, reputations and a continued pay check) when they have the courage and integrity to spotlight illegal action.
The U.S. Securities and Exchange Commission certainly knows that, given its established whistleblower program and the clear benefits reaped under its provisions. Since the initiative’s establishment back in 2010, an estimated $1.4 billion has been recovered from wrongdoers in the securities realm.
The SEC readily concedes that much of that claw back owes to the efforts of whistleblowers. Commission Chairman Jay Clayton recently stated that individuals in that role “have made significant contributions to the SEC’s enforcement efforts.”
The agency wants to keep that valued input steadily coming in and to dampen any disincentives would-be whistleblowers might have to being second-guessing their treatment under the commission’s program. What the SEC specifically proposes is a set of reforms that will better compensate whistleblowers and protect them more robustly against personal reprisals for coming forward.
An Accounting Today article discusses some of the material details relevant to suggestions promoting those aims that were recently advanced by the commission. The proposals can be gleaned via this link. They touch notably upon recovery allowances in more types of proceedings than are currently recognized, and would further allow for upward reward adjustments in many matters.
Whistleblowers play a vital role in spotlighting many types of fraud that would otherwise run unchecked across the United States. They certainly warrant enhanced awards and protections when they take material risks in exposing wrongdoing.