Two senators have revived a whistleblower protection bill aimed at shielding whistleblowers from retaliation and cutting down on the time it takes to receive an award from the Securities and Exchange Commission (SEC).
Sens. Chuck Grassley (R-Iowa) and Elizabeth Warren (D-Mass.) reintroduced the “SEC Whistleblower Reform Act of 2023,” along with co-sponsors Sens. Susan Collins (R-Maine), Raphael Warnock (D-Ga.), and Catherine Cortez Masto (D-Nev.).
”I’m proud to once again lead this push for greater government accountability by protecting the whistleblower process at the SEC,” Grassley said in a press release Wednesday.
The bill would protect SEC whistleblowers who first report wrongdoing to their direct supervisor. Currently, whistleblowers are only protected from retaliation if they report to the SEC or certain designated officials.
The bill would also attempt to ensure claims are processed within a year of a deadline set by the SEC or following the final resolution of all litigation. The current average wait time for resolution is approximately four years. The former head of the SEC’s whistleblower program, Jane Norberg, previously said while reducing the wait time for whistleblowers is “laudable,” making it happen would require more funding and staff at the agency.
Also included in the bill is a provision that would clarify whistleblowers cannot waive their rights through a predispute arbitration agreement. Whistleblower advocates have said arbitration agreements have a “chilling effect” on whistleblowers who fear having to go up against corporation council.
The SEC has paid out more than $1.3 billion in whistleblower awards since the program was established in August 2011. It distributed approximately $229 million across 103 whistleblower awards in fiscal year 2022, the second most in a single year. The agency in FY2021 delivered a record total of $564 million paid to 108 whistleblowers.
Grassley and Warren introduced a nearly identical bill (S.3977) in 2022, but it was never reported out from the Senate Committee on Banking, Housing, and Urban Affairs.
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