Dodd-Frank Act Expands Whistleblower Protections

To encourage employees with inside knowledge to come forward and reveal violations of securities laws, Congress has expanded whistleblower protections from retaliation. As additional motivation, the law adds a ‘bounty’ provision providing lucrative monetary rewards of upto 30% of the monetary sanctions. That’s in cases where sanctions are in excess of $1 million. Whistleblowers must provide “original information” which comes from the independent knowledge or analysis of the whistleblower and is not known by the SEC from other sources. Under Section 922 of the Dodd-Frank Act, employers are prohibited from a)discriminating against–discharging, harassing or threatening an employee for providing information to the SEC. The law provides that whistleblowers may pursue the claim upto three years after the date on which the facts are known or reasonably should have been known by the employee or six years after the retaliation.