Dyer & Berens LLP Expands Practice to Include Representation of Securities Fraud Whistleblowers
On July 21, 2010, in the wake of the latest economic meltdown, President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act into law. One of the bill’s primary provisions is to fight securities fraud, which played a significant role in what has now become known as the “Great Recession."
The Dodd-Frank Act provides important provisions for whistleblowers to assist the U.S. Securities and Exchange Commission (“SEC”) in policing fraud, including considerable monetary incentives and anti-retaliation provisions for reporting violations of the securities laws.
The law empowers the SEC to award between 10% and 30% of any monetary sanctions of more than $1 million to the whistleblowers who provide information leading to a successful SEC enforcement.
Therefore, for example, had Dell Computer's recent $100 million SEC fine resulted from a properly-submitted whistleblower tip, that whistleblower could have been paid a bounty of between $10 million and $30 million!
The SEC may also pay if the information leads to enforcement actions by other governmental organizations, including the U.S. Department of Justice, another federal agency, a self-regulatory organization, or a state attorney general. The government will determine the extent of all awards based on the significance of the information given and the assistance given by the whistleblower and the whistleblower’s attorneys, among other factors.
Under the Dodd-Frank Act, whistleblowers can report fraud anonymously, provided that they are represented by an attorney. And whistleblowers may remain anonymous until right before the incentive payment in sought. In addition, the law further protects whistleblowers by creating a federal private right against employer retaliation.
By adopting these important whistleblower provisions, Congress has taken a vital first step in emboldening and incentivizing honest employees to help root out corporate fraud, and do their part to avoid another financial crisis.
Dyer & Berens LLP has significant expertise in prosecuting investor lawsuits involving financial fraud. The firm’s extensive experience in securities litigation has contributed to the recovery of hundreds of millions of dollars for aggrieved investors. For more information about the firm, please go to www.DyerBerens.com.
Jeffrey A. Berens
Dyer & Berens LLP
303 East 17th Avenue, Suite 300
Denver, CO 80203
Tel: (888) 300-3362 or (303) 861-1764