Workforce Bulletin

Less than two weeks after it last penalized a private employer for alleged violations of whistleblower protection rules in its employee separation agreements, the Securities and Exchange Commission (“SEC”) once again takes aim at the language of a separation agreement it alleges violates Rule 21F-17(a) of the Exchange Act (“Rule 21F”). Just yesterday, the SEC issued an Order settling charges with a commercial real estate services and investment firm for such violations through a fine of $375,000, among other terms. The SEC’s aggressive and continued ...

On December 29, 2022, President Biden signed the Anti-Money Laundering Whistleblower Improvement Act (“the Act”) into law, overhauling the Anti-Money Laundering Act of 2020 (“AMLA”).  When initially passed, the AMLA met with extensive criticism by plaintiff-side whistleblower attorneys for failing to set a defined guaranteed rate for whistleblower awards, with the potential awards ranging from zero percent to thirty percent for identifying wrongful conduct in the anti-money laundering area.  In response to this criticism and to correct other “shortcomings,” Congress amended the law in 2022 through its omnibus budget to expand enforcement measures within the United States and beyond its borders by clarifying who can be a whistleblower and the rewards for successfully raising compliance complaints.  Below, we delve into these changes and their significance for employers.  Essentially, these changes will increase employers’ potential liability for retaliation claims by emboldening newly eligible whistleblowers and their lawyers to raise non-compliance complaints.

On March 19, 2018, the SEC issued an Order jointly awarding two whistleblowers more than $49 million, and awarding a third whistleblower more than $33 million, for reporting information to the SEC that led to its successful prosecution of an enforcement action against the perpetrators of securities violations.

In 2010, the Dodd-Frank Act amended the Securities Exchange Act of 1934 to include Section 21F, entitled “Securities Whistleblower Incentives and Protection.” Among other things, Section 21F established a whistleblower “bounty” program that entitles ...

On February 21, 2018, the U.S. Supreme Court resolved a circuit split and ruled in Digital Realty Trust, Inc. v. Somers that Dodd-Frank’s anti-whistleblower retaliation provision (15 U.S.C. § 78u–6(h)) does not protect employees who report alleged securities violations only to their employers, and not to the SEC.

Paul Somers ("Somers"), a former Vice President of Portfolio Management for Digital Realty Trust, claimed that his employer violated the whistleblower protections of Dodd-Frank by terminating him in retaliation for complaining to management about suspected ...

A featured story on Employment Law This Week is the new legislation proposed in Congress that aims to clarify whistleblower policies.

The Whistleblower Augmented Reward and Non-Retaliation Act would expand protections for those who blow the whistle on financial crimes. The bill would also resolve a circuit court split on the definition of "whistleblower," expanding the scope of the term to specifically include employees who only report violations internally, without filing with the SEC or CFTC. The WARN Act aims to broaden monetary incentives for whistleblowers, and increase ...

On September 10, 2015, the Second Circuit Court of Appeals ruled in Berman v. Neo@Ogilvy LLC that an employee who reports an alleged securities violation only to his or her employer, and not to the SEC, is nevertheless covered by the anti-retaliation protections afforded by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”).

Berman, a former finance director of Neo@Ogilvy, claimed that his employer and its corporate parent, WPP Group USA, Inc., violated the whistleblower protections of Dodd-Frank by wrongfully terminating him for raising ...

By David Jacobs and Amy B. Messigian

We would like to call your attention to a significant change to the whistleblower statute in California that went into effect on January 1.  The statute, Cal. Lab. Code section 1102.5, has been substantially expanded beyond its prior form to now protect employees from retaliation for making internal complaints or even potential complaints about suspected violations of federal, state or local law.

California previously protected employees from retaliation for reporting reasonably suspected violations of state or federal laws to a ...

By David Jacobs and Amy B. Messigian

We would like to call your attention to a significant change to the whistleblower statute in California that went into effect on January 1.  The statute, Cal. Lab. Code section 1102.5, has been substantially expanded beyond its prior form to now protect employees from retaliation for making internal complaints or even potential complaints about suspected violations of federal, state or local law.

California previously protected employees from retaliation for reporting reasonably suspected violations of state or federal laws to a ...

We’re happy to announce that Epstein Becker Green’s Whistleblowing & Compliance Law Blog has joined our blog.  Readers of both blogs will benefit from our coverage of whistleblowing and compliance law, in addition to the financial services employment law topics our readers have come to expect.

This combination represents the addition of more than 40 posts dating back to April 2010, with a focus on Dodd-Frank, Sarbanes-Oxley, the False Claims Act, and whistleblowing-related topics.

In addition, we welcome Allen B. Roberts as a primary contributor to the Financial Services ...