The U.S. Chamber of Commerce warned that the SEC’s approval today of a rule to award whistleblowers a bounty, under a Dodd-Frank Act provision, will derail corporate compliance programs, since the final rule does not require the whistleblower to report the tip to the company, in addition to regulators.
The whistleblower rule will “undermine” companies’ compliance systems that address whistleblowers set up under the Sarbanes Oxley Act, therefore making it “harder and slower to detect and stop corporate fraud,” the Chamber said in a statement today. “In approving this new whistleblower rule, the SEC has chosen to put trial lawyer profits ahead of effective compliance and corporate governance,” according to the document.
