Experts Predict a Big Year Ahead for Corporate Whistleblowers By Tod Aronovitz | 01/29/14 | 0 Comment

Although 2014 has been ‘business as usual’ for whistleblower cases, experts anticipate things will pick up as some decisive cases, currently pending in the courts, are expected to reach resolution this year.

Regulators have put out the word that 2014 could bring some considerable whistleblower awards even though companies are still trying to figure out the best way to deal with employees who report unlawful activity.

Experts of corporate whistleblower issues made five key predictions in a Jan. 27 article on the Wall Street Journal’s Risk & Compliance blog:

1.) Big SEC Whistleblower Awards are on the Way/Whistleblower Tips will Increase

Since the program’s launch in 2011, the SEC’s Office of the Whistleblower has only awarded one large payment, but officials pledge more big awards ahead. There are several pending cases that could award those whistleblowers millions of dollars.  The program may also encourage more employees to come forward, increasing the number of tips submitted to the SEC.

2.) False Claims Act Whistleblower Cases will Carry on at a Strong Pace

As we reported on ARONOVITZ Blog on Jan. 27, the Justice Department secured $3.8 billion in settlements and judgments in fiscal 2013, with the majority of those cases filed by whistleblowers years earlier. In addition, the Justice Department has reported a record number of qui tam whistleblower actions entering the False Claims Act pipeline in the last two years.

3.) Courts will Continue to Delineate who is Considered a Whistleblower

A Supreme Court ruling is expected this year in the Lawson vs. FMR LLC case, which could decide whether anti-retaliation provisions of the 2002 Sarbanes-Oxley Act protect subcontractors and contractors of a public company.

There may also be rulings on who is considered a whistleblower under the 2010 Dodd-Frank financial reform act. Last year, the U.S. Court of Appeals for the Fifth Circuit ruled that whistleblowers had to report suspected misconduct to the SEC for protection from retaliation. However, as lower courts have ruled otherwise, there’s a possibility of a Circuit Court split, indicating the potential for Supreme Court review.

4.)  Companies will ‘Get Creative’ in Obtaining Internal Whistleblower Complaints

More corporations will be thinking about ways, such as monetary bonuses or appreciation gifts, to recognize internal employees on their whistleblower efforts.  However, companies will continue to deliberate whether they can require employees to report internally.

5.)  The SEC will Take Action Against Companies who Allegedly Retaliate against their Whistleblower Employees

SEC whistleblower chief Sean McKessy will continue to lead the SEC’s proactive approach to protecting whistleblowers.  Examples of actions the agency could take include a cease-and-desist order or a monetary sanction.

ARONOVITZ LAW: Miami Whistleblower / Qui Tam Law Firm

The Miami Qui Tam law firm of ARONOVITZ LAW routinely works with Miami whistleblowers to document Medicare fraud and other forms of fraud against the government. Contact Miami Whistleblower / Qui Tam lawyer Tod Aronovitz to discuss a case.