According to Dodd-Frank legislation, the SEC is required to adopt regulations regarding its whistleblower program no later than April 21 2011 (nine months from enactment). According to a recent report released by the SEC, the agency has set aside about $450 million for future payments to whistleblowers whose information results in successful cases and penalties.
The SEC is currently soliciting comments on how the proposed whistleblower program may best co-exist with current corporate compliance programs. Comments may be submitted via the SEC’s online form here.
As a result, the corporate lobby is hard at work petitioning the SEC for favorable requests. Many corporations fear that the act’s financial incentives will prompt whistleblowers to bypass internal corporate compliance procedures. According to the NY Post,the SEC is receptive to such concerns. According to the article, the SEC held a private meeting last week with large pharmaceutical and financial companies on the upcoming program. Attendees included Johnson & Johnson, Tyco International, Pfizer, JPMorgan Chase, Citigroup, Kraft Foods, Prudential, and Gibson Dunn & Crutcher law firm.