New Rules Offer Big Cash Rewards to Whistleblowers

In an article from Yahoo! Finance, new rules adopted by federal regulators on Wednesday could result in large cash awards to those whistleblowers who report corporate fraud.  From the article:

Tipsters would be eligible if they give the Securities and Exchange Commission information that leads to an enforcement action resulting in more than $1 million in penalties. The SEC would pay up to 30 percent of the money it recovers from a company or person.

The new rules would seek to discourage employees from bypassing their companies’ compliance programs. Once employees report potential wrongdoing to their company, the SEC would officially designate them as whistleblowers, potentially eligible for awards — provided they give the SEC the same information within 120 days.

In addition, the SEC will credit whistleblowers whose companies pass their information to the agency, even if the whistleblowers themselves do not. That way, whistleblowers could receive awards by reporting wrongdoing internally to their companies.

You can read the full article here on the Yahoo! Finance website.

This entry was posted in D&O, EPLI, PL Insurance and tagged , , , by plushq. Bookmark the permalink.

About plushq

The Professional Liability Underwriting Society (PLUS) was founded in 1986 by industry professionals who recognized the need for a forum for individuals involved in the field of professional liability. The Society is a non-profit organization with membership open to persons interested in the promotion and development of the professional liability industry. Membership consists of over 6,500 individuals, representing over 1,000 companies active in the many fields of professional liability. PLUS currently receives the support of more than 200 companies through corporate membership. PLUS is recognized as the primary source of professional liability educational programs and seminars, assistance to its members to help serve clients, and information regarding professional liability. The Society is continually seeking new means to fulfill its mission statement and better serve its members.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s