Sec Fraud

In the wake of the Bernie Madoff Ponzi scheme scandal, Congressed passed an SEC Whistleblower Law and the Securities and Exchange Commission established a Whistleblower Office to handle SEC Fraud cases. The SEC Whistleblower Program provides monetary incentives for individuals to come forward and report possible violations of the federal securities laws to the SEC. Under the program eligible whistleblowers may receive an award of between 10% and 30% of any money collected by the SEC or other regulatory and law enforcement authorities. The SEC Whistleblower Law also has a provision prohibiting retaliation by employers against employees who disclose SEC Fraud violations to the Government.

1.Has a pattern emerged yet as to the kinds of SEC Fraud violations which could lead to SEC whistleblower awards?

Qui Tam Contact

No, there really isn’t a solid track record yet. But, in the future we expect to see cases involving misrepresentations in offering materials; insider trading; market manipulation; Ponzi schemes; falsified SEC filings and accounting reports; hedge fund abuses and broker-dealer violations.

Sec Fraud

2. Does it have to be a “big” case?

Yes, unlike many other whistleblower programs, you may submit information about SEC Fraud anonymously to the Government through an attorney. That being said, there are limited circumstances where the SEC may disclose your identity during the course of litigation or to other Government agencies, like the Department of Justice.


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4. Are there restrictions on who can be an SEC Fraud whistleblower?

There are quite a few limitations as to who can be eligible for an SEC award. We would need to review your particular facts and circumstances, but if you fall into one of the following categories, you may find that you are ineligible: an officer, director, trustee, partner, compliance employee, internal or external auditor, accountant or attorney for the target entity.

Do you have any expertise in this area?

Yes, attorney Timothy McInnis was an enforcement attorney with the SEC for two years at the start of his career.




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