On Thursday April 7, National Whistleblower Center (NWC) submitted a formal comment to the SEC regarding proposed amendments to the SEC’s whistleblower program, released on February 10, 2022.
In the comment, NWC expressed strong support for the Commission’s proposed amendments as they reflect needed improvements and corrections to outstanding issues in the September 2020 amendments. Specifically, the amendments would remedy concerns about arbitrary award caps and denials raised by NWC in comments on the Commission’s previous rulemaking.
NWC is pleased the Commission is seeking to fix the Related Action Rule to avoid the denial of a Dodd-Frank Act whistleblower award due to the existence of an alternative whistleblower program. In the September 2020 amendments to its whistleblower program, the SEC limited whistleblower award eligibility for related actions in circumstances where an alternative whistleblower program has the more “direct or relevant connection to the [non-Commission] action.”
As NWC argued in earlier comments, the 2020 rule would discourage whistleblowers from cooperating across agencies with confidence. NWC is encouraged that the SEC revisited this amendment and seeks to further modify and clarify it so whistleblowers will receive a mandatory award not “meaningfully lower than the maximum amount the Commission could award to that whistleblower on that same action.” The adoption of this rule would ensure that any whistleblower eligible for an SEC award would...
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