Fight Investment Fraud
Greco & Greco's lawyers represent investors to recover losses caused by securities fraud, churning, lack of suitability, negligence, sales of unregistered securities, unauthorized trading, and other misconduct by stock brokers, investment advisors, financial planners and their firms.
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New SEC Office of the Whistleblower website
The SEC recently launched its webpage for the Office of the Whistleblower, an office created by the Dodd-Frank Wall Street Reform and Consumer Protection Act. (Click here for the site.) In the words of the SEC Whistleblower Chief Sean McKessy, the goal of the program is to “incentivize you to report possible violations of the US securities laws of which you become aware.” The site contains a FAQ section, links to the SEC Rules regarding whistleblowers, and Form TCR (Tip, Complaint, or Referral) to be used to submit a tip.
If you are a witness to information regarding a possible securities fraud, contact one of Greco & Greco’s attorneys here for a free consultation to discuss your options.
SEC Adopts Securities Fraud Whistleblower Rules
The SEC recently approved final rules to govern its whistleblower program established pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act. The program has been established to encourage individuals to alert the SEC to evidence that helps the SEC in bringing securities fraud cases. The Rules were designed under the Act to increase the SEC’s authority to compensate whistleblowers regarding violations of the federal securities laws. The Rules may be found here.
There are several requirements for a whistleblower to be considered for an award of compensation. The whistleblower must voluntarily provide the SEC with original information regarding violations of the federal securities laws, rules, or regulations that leads to the enforcement by the SEC of a federal court or administrative action in which the SEC obtains monetary sanctions totaling more than one million dollars. The program also covers “related actions” which includes judicial or administrative actions by the U.S. Attorney General, regulatory authorities, self-regulatory organizations, or criminal prosecution by a state attorney general.
In regard to the “original information” requirement, the Rules contain complex requirements, limitations, and exceptions to information acquired through attorney-client privileged situations, and information obtained as an officer, director, trustee, partner, or compliance/audit employee. In certain circumstances, the Rules require disclosure of the information to the relevant entity within a specified time frame for the whistleblower to be entitled to payment under the Rules.
The amount of the award to the whistleblower will be decided by the SEC, however if the Rules’ requirements are met, the award will be between 10 and 30 percent of the monetary sanction that the SEC and other authorities are able to collect. The SEC will exercise its discretion in determining the exact percentage based on criteria set out in the Rules. Some of the positive and negative criteria to be applied by the SEC in the decision making process include significance of the information, assistance provided by the whistleblower, law enforcement interest, participation in internal compliance systems, culpability, unreasonable reporting delay, and interference with internal compliance systems.
This amount may also be divided by the SEC among multiple whistleblowers. Should the SEC deny payment, the Rules provide for an appeals process as well as an ultimate appeal to the U.S. Court of Appeals for the District of Columbia, or the circuit where the aggrieved person resides.
The SEC has provided specific forms for submission of information and a claim for an award. A whistleblower may remain anonymous when providing the information to the SEC, however to do so the whistleblower must be represented by an attorney with respect to the submission of information and claim for an award.
The Act and Rules also provide protections for the whistleblower from retaliation by the whistleblower’s employer, providing certain requirements are met.
If you wish to discuss a potential SEC whistleblower claim with a lawyer, please contact Greco & Greco here for a free consultation with one of our attorneys.
Most recent entries
- Prudential Fined for Failure to Supervise Fraudulent Withdrawals From Variable Annuity
- Washington DC Investment Advisor Dawn Bennett Barred by SEC
- Virginia Broker Andrew Corbman Suspended by FINRA
- Capitol Securities Censured and Fined for Reverse Convertible Notes and Other Conduct
- Investigation Regarding Randy Watts of Winchester, Virginia
- SEC and FINRA FINE UBS OVER PUERTO RICO BOND FUNDS
- Success of FINRA Arbitration Claims against UBS regarding Puerto Rico Bond Funds
- First FINRA Arbitration Award Against UBS of Puerto Rico Regarding Bond Funds
- H.D. Vest Charged With Failures Related to Supervision
- Norfolk Virginia Financial Advisor Charged with Fraud
- Vienna Virginia Financial Advisor Pleads Guilty to Defrauding Customers
- Virginia Regulators Require License Surrender and Fines over sale of 54 Freedom Products
- Brokers barred for stealing from elderly widow
- FINRA fines JP Turner for Leveraged and Inverse ETF sales
- State Securities Regulators release new list of top investor threats
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