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SEC: BlackRock removed whistleblower incentives

Jaclyn Jaeger | January 19, 2017

Asset manager BlackRock has agreed to pay a $340,000 penalty to settle charges that it improperly used separation agreements in which exiting employees were forced to waive their ability to obtain whistleblower awards, the SEC announced.

According to the SEC order, more than 1,000 departing BlackRock employees signed separation agreements containing violative language stating that they “waive any right to recovery of incentives for reporting of misconduct” in order to receive their monetary separation payments from the firm. BlackRock added the waiver provision in October 2011 after the SEC adopted its whistleblower program rules, and the firm continued using it in separation agreements until March 2016.

“BlackRock took direct aim at our whistleblower program by using separation agreements that removed the financial incentives for...

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