Looking for whistleblowers in all the wrong places
Donna Boehme – Compliance & Ethics Professional – January/February 2012
That was fast. An early test of the new Dodd-Frank whistleblower rules has arrived via a small whistleblower group, recruited by Harry Markopolos (of Madoff fame), alleging systematic FOREX fraud by two banks, BNY Mellon and State Street. The DOJ and a posse of state attorneys general are looking for $2 billion in clawback, for starters. The group may earn up to 25% of the penalties collected under state false claims statutes, and between 10-30% under Dodd-Frank.
Does this portend a “new breed” of whistleblower in the making—one that is not born from outrage at an observed misconduct, but recruited from without by expert investigators? According to a new Congressional report, the SEC’s cup runneth over: 334 tips “led during the first 7-week effective period. Time will tell.
. . .
