The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) was signed into federal law in July 2010 to combat misconduct and fraud in the private investment sector.
In addition to establishing regulations and possible penalties for violations, Dodd-Frank includes provisions to protect whistleblowers and reward them for reporting misconduct in the securities and commodities markets.
What forms of fraud does Dodd-Frank cover?
A full list of the kinds of fraud covered by Dodd-Frank is too long to include here and growing longer each year, but the following are some examples:
- Insider trading
- Unauthorized trading
- Accounting fraud
- Ponzi schemes
- Misrepresentation in the sale of commodities and securities
- Misleading public filings
- Market manipulation
- Skimming funds
- Improper sales of risky investments
- “Pump and dump” schemes
How is Dodd-Frank similar to the False Claims Act?
Dodd-Frank and the FCA are similar in that both provide whistleblowers with protections against retaliation, and both laws provide whistleblowers with monetary rewards of up to 30% of the amount recovered by the government.
How does Dodd-Frank differ from the False Claims Act?
A primary difference between Dodd-Frank and the FCA is that the fraud need not be committed against the government in order to be covered under Dodd-Frank.
Additionally, Dodd-Frank allows for whistleblowers to be rewarded even if the government has already started a related investigation by the time the whistleblower reports. The requirement here is that the information provided by the whistleblower be original and useful.
A Dodd-Frank whistleblower is also not required to file a complaint in federal court. Instead, you file with the Commodity Futures Trading Commission for commodities violations, and you file with the Securities and Exchange Commission for securities violations. Each of these agencies now has a whistleblower office.
What kinds of protections against retaliation does Dodd-Frank provide to whistleblowers?
Under Dodd-Frank, if an employer uses unlawful discharge or discrimination in retaliation against a whistleblower, the whistleblower is entitled to twice the amount of back pay with interest, reinstatement with the same seniority status, and compensation for attorneys’ fees and other litigation costs.
Get Answers Directly From An Attorney
At Hilder & Associates, P.C., we have a wealth of experience in handling whistleblower claims. To speak with a whistleblower lawyer about your rights and protections under the Dodd-Frank Act, email or call our Houston offices at 713-234-1416 or toll-free at 888-659-8742.