On Thursday, December 9, Goodwin Procter partners Deborah Birnbach and Heidi Goldstein Shepherd presented a webinar on what the whistleblower provisions in the Dodd-Frank Act mean for companies of all kinds and what can be done to prepare for the changes.
The Dodd-Frank Act directly impacts all public companies and others subject to the securities laws, and not merely financial institutions. The Act's whistleblower provisions are some of the most talked-about reforms, because they greatly expand existing law under Sarbanes-Oxley; it is not just about retaliation anymore. Under Dodd-Frank, whistleblowers now have a direct financial incentive to report securities law violations directly to the SEC, and can bypass internal compliance protocols. In doing so, they now stand to recover a reward of 10 to 30% of the financial penalties and disgorgement obtained by the government from the subject company.