Practical Steps to Address Recent SEC Enforcement Activity Regarding Impediments to Whistleblowing

This past Summer, the U.S. Securities and Exchange Commission (SEC) announced two settlements in which the SEC adopted a strict interpretation of the whistleblower protections afforded under the Dodd-Frank Wall Street Reform and Consumer Protection Act.

In doing so, the SEC imposed monetary sanctions on companies for including language in employment-related agreements that it asserts deters employees from reporting securities law violations to the SEC’s Office of the Whistleblower (and other agencies). The SEC imposed a variety of remedial measures as part of the settlements as well. In light of these actions and the SEC’s apparent enforcement position, employers should consider reviewing their employee agreements, policies, and codes of conduct to ensure that that they do not include provisions that the SEC may assert deter employees from coming forward with information about potential securities law violations. This presentation provides practical steps designed to assist companies in this review.

Compliments of Wilson Sonsini Goodrich & Rosati – a member of the EACCNY