Whistleblower Claims Under SOX And Dodd-Frank: Recent Developments - June 2016

In 2002, Congress passed the Sarbanes-Oxley Act ("SOX"), which extends whistleblower protections to certain individuals who report conduct they reasonably believe constitutes a violation of federal mail, wire or bank fraud laws; any rule or regulation of the Securities and Exchange Commission ("SEC"); or any provision of federal law relating to shareholder fraud. In 2010, President Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank"). Dodd-Frank prohibits employers from retaliating against employees for disclosing information as required or protected under SOX; the Securities Exchange Act of 1934; and any other law, rule or regulation subject to the jurisdiction of the SEC. Dodd-Frank also required the SEC to implement a new whistleblower program — the so-called bounty program — that pays to whistleblowers cash awards of between 10% and 30% of amounts the SEC recovers based on the whistleblower's report.