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