Tariffs-Free Regulatory Importing?
Asad Akhtar
identified whistleblowers jeopardize their existing employment (even in consideration of antiretaliation provisions). Further, ostracism related to “snitching” on one’s employer may
negatively impact their ability to secure future employment.39 40 Finally, whistleblowers may
incur direct financial losses by reporting fraud as opposed to maintaining the status quo. In
illustration, accounting manipulations occurring at Fannie Mae between 1998 and 2004 were
found to be the result of a bonus program that incentivized auditors to skew results in order to
maximize bonuses for themselves.41
2. Expansions under Dodd-Frank
Despite its limited use, effectiveness and public awareness, 42 the SEC has continuously
operated a bounty program to reward whistleblowers since the Insider Trading and Securities
Fraud Enforcement Act of 1988. Under the original framework, whistleblowers who provided
original information that led, or substantially contributed, to successful enforcement action in
insider trading offences were eligible for up to 10 percent of the penalties collected.43
Section 922 of Dodd-Frank substantially expands the agency’s whistleblowing program
(Section 21F – Securities Whistleblower Incentives and Protection) in several fronts.44 It
expanded the eligibility of compensation to all securities law breaches and not just to insider
trading cases. It also increased the size of the reward to, at the SEC’s sole discretion on the basis
of information provided, between 10 to 30 percent of any successfully recovered amount over $1
Allan Cutler, “For whistleblowers, reprisals and stigma are for life” (February 10, 2014), online: Canadians for
Accountability .
40
Jana Kasperkevic, “Are financial whistleblowers worth it? Study says yes – to the tune of $21.27bn” (November
19, 2014), online: The Guardian .
41
James R Cristie, Fanie Mae and Freddie Mac: Scandal in US Housing, (New York: Novinka Books, 2007) at 230231.
42
Supra, note 37 at 192-193.
43
Ibid.
44
Ibid.
39
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