I have written a lot about the concept of “professional whistleblowers” through the years. Now, the WSJ reports, a new hybrid group of professional whistleblowers and corporate employees is about to get paid massive sums for their efforts to uncover securities law violations in the foreign exchange markets.
Looking back, I pondered in 2010 whether Dodd-Frank might one day spawn “professional whistleblowers,” i.e., whistleblowers who were not employees of a company violating the law but rather academics or other third parties who use their talents to identify and alert authorities to such violations. Indeed, Section 922 of Dodd-Frank does not require the whistleblower to be an employee. As stated in this Dow Jones Newswires article from 2010, Section 922 may well be open-ended on this point because it was “inspired by Harry Markopolos, who hounded the SEC for years with his hunch that Madoff was running a giant Ponzi scheme.” One attorney quoted in the article predicted that future whistleblowers might include “a lot of extraordinarily, analytically brilliant people spending time thinking about why something doesn’t add up,” he said.
