SEC looking to strengthen whistleblower programme
Gary Gensler, Chair of the US Securities and Exchange Commission (SEC), has revealed that the SEC is reviewing its whistleblower programme.
Delivering keynote remarks at the National Whistleblower Center’s (NWC) National Whistleblower Day 2021 celebration, Gensler spoke of the critical role whistleblowers play in SEC enforcement efforts and reemphasised his commitment to the agency’s whistleblower programme. He also revealed that he has directed staff to review the whistleblower programme in order to improve its efficiency and effectiveness.
“The tips, complaints, and referrals that whistleblowers provide are crucial to the Securities and Exchange Commission as we enforce the rules of the road for our capital markets,” said Gensler. “Each week, when I see the Commission’s enforcement actions, I’m reminded how the whistleblower program helps us be better cops on the beat, execute our mission, and protect investors from misconduct.
“I’ve asked staff to examine whether and how the programme can be further strengthened to ensure misconduct within the remit of the SEC is identified, addressed, and stopped. We must ensure that whistleblowers are empowered to come forward when they see misbehaviour and that they are appropriately compensated according to the framework established by Congress, and that those who report wrongdoing are protected by retaliation. I also believe we should look for opportunities to continue to reduce processing times in SEC whistleblower award determinations.”
"We are pleased to hear that Chair Gensler and his staff are reviewing the SEC's highly successful whistleblower program," said NWC Executive Director Siri Nelson. "While the programme has been an immense success, there are areas, such as the processing time for award claims, which need improvement. The SEC Whistleblower Program should be consistently reviewed to ensure that it best protects whistleblowers and serves the interest of the American public."
“NWC plans on engaging in the discussion around potential reforms and will issue formal comments soon after National Whistleblower Day,” adds Nelson. “We would be happy to meet with the Chairman, the Commissioners, and other members of the SEC Commission Staff.”
In the decade since it was established, the SEC Whistleblower Program has been an immense success. Whistleblower disclosures have allowed the SEC to recoup nearly $3 billion in monetary sanctions and the whistleblower program has awarded approximately USD942 million to 186 individuals.
In September 2020, the SEC approved a number of rule changes to its whistleblower program. A number of these changes, including altered rules on “related-action” awards and stricter guidance on awards for independent analysis, were criticised by whistleblower advocates.