Compliance

12:47 PM
Melanie Rodier
Melanie Rodier
Commentary
Connect Directly
Facebook
Google+
LinkedIn
Twitter
RSS
E-Mail
50%
50%

Who’s Really Cashing In On the Whistleblower Program

Unsurprisingly, the whistleblower program instituted by Dodd-Frank is paying off. But it isn't just the whistleblowers who are set to cash in.

Thanks to the Dodd-Frank Financial Reform Act, whistleblowers stand to make up to 30% of whatever amount a regulator gets from a company in court. If you blow the lid on a major fraud, this can be akin to winning the lottery. Just think what Harry Markopolous could have made had the SEC actually listened to him when he tried to expose Bernie Madoff’s $50 billion Ponzi scheme.

Unsurprisingly, the whistleblower program instituted by Dodd-Frank is paying off: American corporations are sending thousands more tips to the SEC, Marketplace Morning News notes.

But what is more surprising is who the real winners are. As the understaffed SEC struggles to handle all the tips that are coming in, court documents exposing fraud are now being handed to them not by whistleblowing employees themselves, but by lawyers. “You wouldn’t call it ambulance chasing,” the Marketplace’s Gregory Warner says: “but lawyers are definitely seeing a reward in helping whistleblowers to present their evidence in the most useful way to the SEC.”

Melanie Rodier has worked as a print and broadcast journalist for over 10 years, covering business and finance, general news, and film trade news. Prior to joining Wall Street & Technology in April 2007, Melanie lived in Paris, where she worked for the International Herald ... View Full Bio
Comment  | 
Print  | 
More Insights
More Commentary
Business Continuity 2.0: We’re Gonna Need a Bigger Boat
What would happen with a long-term outage to financial systems or the nation’s critical infrastructure? Businesses aren’t even close to being prepared.
Using RPA in Banking to Streamline Development
As the returns on outsourcing decline, firms are looking for other ways to increase efficiency and reduce costs in the IT organization. Robotic Process Automation may help.
SEC Vote Is Drama for the Masses, With No Happily Ever After
All of them hoped it would never come to this.
Driving Information Security, From Silicon Valley to Detroit
As software interacts with more and more of our daily lives, technology providers may be liable for more damages than they have in the recent past.
Big Data's Challenge: Matching Business Needs With Technology
All those bits and bytes only add up to something when they’re organized, arranged, and made coherent.
Register for Wall Street & Technology Newsletters
White Papers
Current Issue
Wall Street & Technology - July 2014
In addition to regular audits, the SEC will start to scrutinize the cyber-security preparedness of market participants.
Video
Stressed Out by Compliance, Reputational Damage & Fines?
Stressed Out by Compliance, Reputational Damage & Fines?
Financial services executives are living in a "regulatory pressure cooker." Here's how executives are preparing for the new compliance requirements.