SEC Whistleblower Blog

SEC Steps Up Efforts to Regulate Virtual Currency Offerings and Exchanges

February 8, 2019
The U.S. Securities and Exchange Commission (“SEC”) has recently stepped up its enforcement actions against virtual currency exchanges and Initial Coin Offerings (“ICOs”) that violate federal securities laws. Due to the highly technical nature of virtual currency and its underlying technology, the area long operated as a sort...

Vanguard Whistleblower Gets Procedural Dodd-Frank Retaliation Win Post-Somers, but Hurdles Remain

January 24, 2019
On November 2, 2018, a federal court granted plaintiff David Danon, a former Vanguard Group Inc. attorney, leave to amend his complaint for the second time to better frame his Dodd-Frank Act whistleblower claims. The second amended complaint shifts the focus of his legal theory in an effort to meet the definition of a...

Are Proposed Changes to the SEC Whistleblower Program a Step Backwards?

October 24, 2018
This summer, the SEC voted 3-2 to propose amendments to the rules governing its whistleblower program (the “Proposed Amendments”).  At nearly 200 pages long, the Proposed Amendments contain a number of substantive proposed changes to the Program.  As the two dissenting Commissioners and others have noted, the Proposed...

Vanguard Whistleblower Case Proves the Challenges brought on by Somers Decision

June 6, 2018
In the wake of the Supreme Court’s decision narrowing the scope of who is considered a “whistleblower” under the Dodd-Frank Act of 2010, a former tax attorney with an ongoing whistleblower retaliation claim against his former employer now faces an uphill legal battle for his Dodd-Frank claim to survive. David Danon brought...

Yahoo Settlement Reflects Important Role of Cybersecurity Whistleblowers

May 3, 2018
The U.S. Securities and Exchange Commission (SEC) has reached yet another settlement arising from a cybersecurity event. On April 24, 2018, the SEC announced that it had reached a $35 million settlement with Altaba, Inc. – the company formerly known as Yahoo! Inc. – to resolve claims that the company misled investors by failing...

SEC Increases Scrutiny of EB-5 Investment Fraud

April 9, 2018
The Immigrant Investor Program, or EB-5 Program, was until recently a little-known visa preference program operated by a division of the U.S. Department of Homeland Security. But the program made headlines in January 2018 when The Wall Street Journal reported the Kushner Companies’ use of the program was under investigation by...

SEC Reports 3 of its Biggest Whistleblower Payouts and a Steady Increase in Tips in 2017

February 20, 2018
The U.S. Securities and Exchange Commission (SEC) Office of the Whistleblower has filed its Annual Report to Congress for FY2017, marking another banner year for the SEC Whistleblower Program. During FY2017, the SEC issued whistleblower awards totaling nearly $50 million to 12 individuals. The fiscal year included three of the...

Florida Court Broadly Reads Reasonableness Standard in SOX Whistleblower Case

February 15, 2018
Congress has passed numerous whistleblower protection laws to shield company insiders and others who act in the public interest from retaliation as a means to encourage them to report and attempt to prevent illegal activity. To invoke these whistleblower protection laws, employees must prove that they engaged in “protected...

Initial Coin Offerings: A New Frontier for the SEC and Whistleblowers

January 16, 2018
In July 2017, the U.S. Securities and Exchange Commission (“SEC”) issued an investigative report concluding that virtual tokens and coins may be securities subject to federal securities laws. The SEC’s conclusion may have wide-ranging implications for a burgeoning area of investment in innovative financial markets and the tech...

SCOTUS - Oral Argument in Digital Realty Trust v. Somers. Section 922 of the Dodd-Frank Act

December 6, 2017
Update: On Feb. 21, 2018, the Supreme Court unanimously held that the statute’s definition of “whistleblower” was unambiguous and therefore precluded the SEC from more expansively interpreting that term.  Digital Realty Tr., Inc. v. Somers, No. 16-1276, --- S. Ct. ---, 2018 WL 987345, at *14 (U.S. Feb. 21, 2018).  As...

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