Prior to 2010, whistleblowing was one of the most dangerous things to do. It is unfortunate that thousands of people lost their jobs, suffered emotionally and most of them were subjected to physical torture. However, in 2010, Congress made one of the most revolutionary laws in the modern corporate world. The legislation among other things was part of a large plan to protect whistleblowers. According to legal pundits, Dodd-Frank (Wall Street Reform and Consumer Protection Act) has redefined, in the last eight years, the position of whistleblowers in the corporate space.
Who qualifies to be as SEC whistle blower?
The definition of a whistle blower has been subject to many definitions. Some definitions focus on what the whistleblower does while others focus on the impact of the activity. However, according to SEC, a whistle blower must meet the following criteria. First, the whistle blower must provide new information to the SEC. The new information in this context means that the information must not be on the public domain or before a judge. Second, the information provided must be sufficient for a legal proceeding. This criterion removes room for half-baked allegations against corporate leaders and more specifically creates a path for better and more efficient reporting mechanisms.
Which factors SEC seeks before making monetary rewards?
Monetary rewards are one of the ways SEC appreciate information from a whistleblower. However, not all information provided qualifies for a monetary reward. The following factors must be present before the SEC make a monetary reward. First, the information given must qualify an SEC evidence as discussed above. If the information given is enough to initiate a sanction to the party involved in corporate fraud, then the reward is a guarantee. However, the sanction value must be $1,000,000 or above in terms of value. Finally, for a whistleblower to receive a monetary reward, their information must be the legal threshold for legal action.
What is the process of reporting corporate fraud?
A whistle blower can file a complaint or a corporate scandal in two major ways. First, they can use the online platform and file through the SEC portal. Alternately, they can use the traditional way and send the complaint in form of a physical letter to SEC. Regardless of reporting method, they must adhere to the above guidelines. In order to have a smooth filling process, it is important to do it through a SEC whistleblower attorney. The use of an attorney is ideal is in maintaining anonymity and ensuring that all sections of SEC guidelines are adhered.
Advantages of reporting a corporate scandal through SEC
With the new legislation, the position of a whistleblower in this dispensation is better and more protected. Unlike the previous times where a whistle blower was not protected from the aftermath of reporting a fraud, whistleblowing in this particular age is better. For example, the law protects the whistle blower from any instances of job loss or demotion. In addition, the whistleblower is free from all types of tortures from the party involved in the scandal or corporate fraud.