SEC Fraud

In order to protect the public and the economy, there are numerous regulations to ensure that securities are traded in a fair and open manner. These regulations preserve an open marketplace that is the backbone of our economy. Sometimes, however, companies and individuals violate these regulations with the hope of gaining an unfair advantage against everyone else.


The Securities and Exchange Commission (SEC) has been fighting market manipulation since its inception. However, it recently established a whistleblower program to engage the public in the fight against securities fraud. Individuals with inside knowledge of securities fraud now have the ability to file a whistleblower claim to bring such fraud to the attention of the SEC. In return, the SEC whistleblower program provides financial awards for eligible whistleblowers whose disclosures lead to a successful SEC action.


What Is the SEC Whistleblower Program?


The 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank") established a SEC whistleblower program, which went into effect on August 12, 2011. Under the program, an individual with inside knowledge of securities fraud may report it to the SEC. The SEC will then investigate the allegations. If that investigation results in a successful action by the SEC, Dodd-Frank requires the SEC to pay a monetary award to eligible whistleblowers. In addition to a monetary award, the Dodd-Frank also provides other benefits to potential whistleblowers. Provisions of the Dodd-Frank act also protect eligible whistleblowers from retaliation by their employers for reporting the fraud to the SEC.


Who Can Be a Whistleblower?


In order to be an eligible whistleblower, an individual must have original information about a potential violation of federal securities laws that has occurred, is ongoing, or is about to occur. Such violations can include, but are not limited to:


  • Insider trading

  • Market manipulation

  • Fraud in connection with public offerings/takeovers

  • Fraud in connection with dealings with customers

  • Accounting fraud and foreign bribery at financial and industrial companies


Have a question about whether or not you may have a whistleblower claim? Call us today at (248) 539-7420.. All inquiries will be kept strictly confidential. Please note that it is important to act promptly. Any delays may jeopardize your ability to successfully file a whistleblower case. Additionally, many whistleblower laws also have statutes of limitation which act as filing deadlines, so you must act quickly to protect any rights you may have.