SEC Fraud Tips: When to Blow the Whistle
Blowing the whistle on securities violations is the right thing to do. In financial markets, a certain level of integrity is expected. When brokers or corporations compromise this integrity, it damages the trust investors had, which can have a devastating impact on the economy.
Before you report your tip to the Securities and Exchange Commission (SEC) or your internal compliance program, however, there are certain steps you can take to build your case as a whistleblower and maximize your potential for winning a reward.
Dealing with Internal Reporting
The Sarbanes-Oxley Act of 2002 mandated that corporations implement internal compliance programs, complete with whistleblower hotlines, so that they can take an active role in stopping fraudulent activity and give whistleblowers an opportunity to report tips anonymously.
Before you report your information to the SEC, do your best to utilize your company’s internal compliance program (ICP). Get the names of the individuals you’ve reported to and keep notes of what was said when you made your report. If you have documents that support your claims, make copies of them and provide them to your ICP.
Act Quickly
You should report to the SEC following an internal report. This is because you’ll want to go on record with the SEC as the first whistleblower providing this specific information if you hope to win an award.
You should also provide the same documents and notes you took when you reported internally to the SEC. This gives your company a chance to come forward on its own before an investigation begins.
It will also be crucial for you to report to the SEC after doing so internally to protect yourself from retaliation. The Dodd-Frank Act includes protection for whistleblowers against retaliation.
Employers are not legally allowed to terminate, demote, suspend, or harass you or smear your professional reputation—doing so would constitute retaliation. If they do, both you as an individual and the commission can take action against the corporation.
Voluntary and Original Information
You want to be the first whistleblower to provide information to the SEC. If multiple individuals come forward with the same tip, only the first will be eligible for a whistleblower award. You will also need to blow the whistle voluntarily. Come forward before the SEC has already begun an investigation or interviewed you.
Once an interview begins, you’ll have missed your opportunity. Only whistleblowers who bring information to the SEC without being compelled to do so will qualify for awards. It will also help your case if you are able to provide original financial statements or names of specific individuals involved.
Call an SEC Whistleblower Lawyer
If you’re prepared to blow the whistle on a possible securities violation, it’s important that you make use of your company’s internal compliance program and act quickly once you obtain information. Your tip should also be voluntary and original when you do come forward.
Get in touch with an experienced SEC whistleblower lawyer at Meissner Associates today for help reporting your tip to the SEC and starting on the path to becoming an award-winning whistleblower. You can schedule a no-obligation consultation by filling out the secure contact form below or giving us a call at 1-866-764-3100.
