Posted on 07/23/2010 2:29:47 PM PDT by matt1234
The new financial reform law has what some lawyers call a secret weapon against fraud on Wall Street and in corporate America: the promise of a million-dollar jackpot to insiders who reveal an illegal scheme to the government.
Tucked in the massive bill is a provision that for the first time extends a concept long applied to government contracts to the private sector. It gives whistle-blowers a mandatory 10% — and as much as 30% — of what the government recoups in fines and settlements in financial fraud cases. These can include insider trading, false earnings reports and classic Ponzi schemes.
To claim a bounty, the whistle-blower must provide the Securities and Exchange Commission with "original information" that reveals the fraud and leads to a successful recovery.
"This is very significant and will have an immediate impact," said Erika Kelton, a Washington lawyer who has represented whistle-blowers. "It will motivate knowledgeable insiders to step forward and tell the enforcement agencies what they know. It is the secret weapon in this massive bill."
But some are worried about unintended consequences of the provision.
Some employees may see an incentive not to report a problem internally, but instead "to go to the SEC with it," said Martin Rosenbaum, a Minneapolis lawyer. After the collapse of Enron Corp. and the passage of the Sarbanes-Oxley Act, companies tried to keep problems in-house by setting up hotlines and encouraging employees to tell top management if they saw questionable conduct.
"Most people want their company to be strong and do the right thing," Rosenbaum said. "This has the potential to be a game changer," but not necessarily a good one, he said.
(Excerpt) Read more at latimes.com ...
“...who reveal an illegal scheme to the government.”
By what right, by what code, by what standard?
So, we can blow the whistle on Obama and congress and receive a huge award? ha ha ha
So, we can blow the whistle on Obama and congress and receive a huge award? ha ha ha
oh good, maybe those people in utah who exposed illegal
immigrants working with fraudulent ssi numbers will
be rewarded instead of prosecuted.
SICK, SICK, SICK!!!
Who was that Inspector General Obama fired right when he took office? That’s what whistleblowers can expect.
You mean WALPIN?
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