/SEC Votes on Whistleblower Rule Amendments

SEC Votes on Whistleblower Rule Amendments

WHAT HAPPENED?

On June 28, 2018, The Securities and Exchange Commission (SEC) voted to propose amendments to its whistleblower program. The whistleblower program, established in 2010, was created to give individuals an incentive to report “high-quality tips” to the Commission.  The goal of the whistleblower program is to help the agency better protect investors by detecting violations.

The proposed rules would provide the SEC with the tools to appropriately award commendable whistleblowers, streamline the whistleblower claims review process, and solidify the stipulations for anti-retaliation protection under the statute.

Since the program has been launched, the SEC has awarded over $266 million to 55 whistleblowers for information that has successfully assisted the SEC in enforcement actions.

WHAT DOES THIS MEAN FOR ME?

In February 2018, the SEC ruled that advisers are prohibited from implementing policies that prevent employees from reporting violations to the agency.  Instead, Advisers are encouraged to conduct thorough testing to identify any potential issues or security law violations.  If violations are identified, then advisers should take prompt action to address the violation as necessary.

Please contact Fairview® if you have any questions or concerns regarding whistleblower protection and your compliance program.

About the Author:

Fairview®
Founded in 2005 with the goal of developing streamlined back office solutions for investment advisers, Fairview® is now servicing investment advisers, foundations and funds with over $185 billion in collective assets.