On September 8, 2022, the Board of Governors of the Federal Reserve System (“Fed”) released a statement that encourages whistleblowers to report certain activities at banking organizations it regulates (“2022 Guidance”).1 The 2022 Guidance is notable as one of the first interpretations by a federal banking regulator of the whistleblower provisions of the Federal Deposit Insurance Act (“FDIA”).
Banking organizations should be aware of the types of conduct that may be reported under the 2022 Guidance and the protections that apply to whistleblowers. In this Legal Update, we provide background on the whistleblower provisions of the FDIA and explain the 2022 Guidance.
Background
The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 added Section 33 and 34 to the FDIA.2
Protection
Section 33 prohibits an insured depository institution from discharging or otherwise discriminating against any employee with respect to compensation, terms, conditions, or privileges of employment because the employee (or any person acting pursuant to the request of another employee) provided information to a federal banking regulator or to the US Attorney General regarding (i) a possible violation of any law or regulation or (ii) gross mismanagement, a gross waste of funds, an abuse of authority, or a substantial and specific danger to public health or safety. A whistleblower who believes that they have been discharged or discriminated against in violation of Section 33 may bring...
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