TOPEKA — A two-year inquiry into federal whistleblower programs created to thwart corporate fraud led a University of Kansas law professor to conclude two prominent initiatives aimed at identifying misconduct were undermined by cronyism and secrecy.
Alexander Platt, an associate professor specializing in securities regulation and corporate governance, said lack of transparency existed in programs at the Securities and Exchange Commission and the Commodity Futures Trading Commission compensating business insiders offering evidence of malfeasance.
A concentrated group of private attorneys representing a big chunk of SEC and CFTC whistleblowers earned hundreds of millions of dollars while avoiding accountability beneficial to the public and policymakers, he said.
Platt said the SEC and CFTC were obligated to preserve anonymity of whistleblowers, many of whom disclosed secrets while remaining employed at companies accused of misdeeds.
“The problem is the agencies have invoked this justification as an excuse to also hide embarrassing or controversial information about the programs’ operations,” said Platt, who published findings through the Columbia Law School.
The SEC has been entrusted with protecting investors by enforcing U.S. securities law and taking action against wrongdoers. CFTC’s mission is to protect the public from fraud, manipulation and abusive practices in the sale of commodity and...
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