The U.S. Securities and Exchange Commission (SEC) regulates laws that protect investors and companies in Alabama and throughout the country. They operate a national whistleblower program to identify, prevent and punish acts of securities fraud. Whenever whistleblowers face new challenges, the SEC creates and passes whistleblower reform laws and extends their protections.
New legal protections
The SEC Whistleblower Reform Act of 2022 was passed as a reform law that provides greater protections for whistleblowers who are threatened with acts of retaliation. Under the Act, claims are processed faster, and whistleblowers receive their payments faster. Before the change, the speed of processing claims took several months or years.
Whistleblowers are also given a wider range of options for reporting misconduct. The new law allows individuals to report violations to any type of direct superior, such as a manager or politician. In the past, whistleblowers were protected only if they lodged a complaint directly with SEC officials.
Existing programs
There are several additional national whistleblower programs that receive tens of thousands of tips a year. The Commodity Futures Trading Commission (CFTC) Whistleblower Program provides millions of dollars in financial rewards to whistleblowers while protecting their privacy and anonymity. Participants must provide information that is not known to the SEC or any organization and the whistleblower claims must lead to a law enforcement action and the recovery of lost funds.
Over the past few decades, the U.S. government has made many changes to laws that protect whistleblowers. In the end, new reforms make it easier for individuals to prosecute violations of federal securities laws. Adding protections for whistleblowers will make those with information about wrongdoing more likely to come forward.