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SEC Whistleblower Blog

Qualified/Selective Representation

The ABA Labor and Employment Law Conference 2106

I was fortunate to appear at a panel discussion at a recent ABA National Conference of Employment Lawyers in Chicago. The topic was "Advising Clients throghout the Whistelblower Investigation: A Candid Discussion Regarding the Complex Issue of How Lawyers Work with their Clients." I also submitted a paper titled "Sox, Dodd Frank, Retailiation and Reward--Representing The Client In the Age of the Whistleblower." While the article is a bit long (there was no page limit) I recommend it to anyone thinking about becomming an SEC whistelblower, and also to any lawyer considering representing them. Drawing from my personal experiences over 5 years representing individuals in SEC whistelblower matters, I describe some of the decisons made by me and my clients during the many months and the highs and lows of this complex process. I share some of those experiences through the hypothetical case of a whistleblower named Mary. The article should be available on the internet and I will attach it to the Publications List on this website. 

Donald Trump, Dodd-Frank, and Whistleblowers

Today's New York Times discussed how a President Trump might approach "the unwinding of Dodd-Frank." Somewhat surprisingly, the article concluded that Trump would probably not dismember the law. It suggested that repealing Dodd-Frank would not "gain much traction" in Congress, and that many banks, for example, "admit they have spent so much time and money complying with the law, they would rather keep it."

Anti-Corruption Conference

I am pleased to say that I have been asked to present a paper at the to the Anti-Corruption Law Interest Group at the Conference of the American Society of International Lawyers in January 2017 in Miami. The Conference is titiled "Controlling Corruption: Possibilities, Practical Suggestions and Best Practices." I plan to discuss how more whistleblowers can be enticed to file cases with the SEC and CFTC. My thought is that many more whistleblowers around the world might come forward if they understood the programs better and had more confidence their tips would be considered and investigations initiated. I believe international anti-corruption organizations do a very good job at increasing transparency and enhancing internal control and compliance. But whistelblowing is still widely misunderstood and the various international rules regarding how and when a whistleblower may be rewarded, and be protected from retaliation, are conflicting and confusing. With the advent of databases, wikileaks, data breaches, Panama papers, etc, there is a lot more inside information available on the internet to aid investigative reports, and whistleblowers, in exposing what can often turn out to be massive international frauds. Handled properly, and submitted to the right enforcement agencies, there can be substantial awards possible for whistleblowers, if they are aware of the possibilities. 

Telia, Embraer--more big reward FCPA cases

I continue to think the FCPA is the place to go to find potentially large whistleblower awards. I have written about this before, see my articles list. The fact is that these cases are not that hard to find if you are in a company that has lots of so-called "agents" representing the company in far flung places where bribery is common. Your firm may be using such a shadowy person about whom rumors abound. Maybe other companies are using them also. You don't really have to have hard evidence that they are passing on bribes--let the SEC lawyers find that. Embraer just paid $205 million to settle FCPA charges with the DOJ and SEC. It bribed officials in multiple countries, and made more than $83 million from the bribes. This is a nice feature of FCPA settlements, the penalty and disgorgement can be based on the value of the contracts awarded, regardless of the size of the bribes. The SEC disgorgement tab, $98 million, was one of the largest ever.

Dan Hurson's Client Receives a large whistleblower award

I am pleased to announce that my whistleblower client was recently awarded more than $3.5 million by the SEC. This is among the largest awards given by the SEC Whistleblower program. This case was particularly gratifying because the SEC Claims Review Staff initially rejected the claim, but later reversed itself and made the award after receiving additional information. My client and I are very grateful to the Office of the Whistleblower and the SEC enforcement staff for helping us to achieve this very unusual result.

The Panama Papers--the Whistlebower's Treasure Trove

Congratulations to whoever had the guts to publish the Panama Papers. My guess is was an unhappy summer associate at the law firm in Panama who sneaked in after hours with a large-capacity thumb drive! In any event this is the world- wide equivalent of the infamous Pentagon Papers leaked by Daniel Ellsburg in 1971 (guess I am dating myself here). As I read the NYTimes this morning, many foreign officials and high rollers have been hiding their money offshore. Of course all the heads of state will say they acquired their wealth legally. A few of them may be telling the truth, maybe. Important heads may yet role across the globe, although it will take time to sort all the information out. I guess the only folks who can protect themselves for awhile are the Chinese leaders who can seem to push a button and block the entire nation from going on the Internet.

FCPA INVESTIGATIONS KEEP COMING

It seems that each week brings the announcement of another FCPA investigation being conducted by the SEC or DOJ. This week Alere Inc., a diagnostics test maker, said in an SEC filing that it had received a grand jury subpoena from the DOJ for documents relating to its sales practices on multiple continents. Alere's filed 8-K relating to such sales practices and "other matter related to the U.S. Foreign Corrupt Practices Act." I will bet the subpoena said a lot more than that but the lawyers figured that was enough disclosure for now. Nice though that they made any disclosure at all--some lawyers continue to think that a subpoena does not deserve an 8-K until it ripens into an enforcement action or an indictment. The company also said it would delay filing its annual report because of revenue recognition issues, so lots of apparent problems there.

Welcome to the SEC Whistleblower Blog

This is my first blog post to my SEC Whistleblower Blog. I will use the blog to note cases, ideas, and whistleblower opportunities, and to comment on various issues at the SEC, DOJ and other enforcement entities which may be relevant to whistleblowers. I may occasionally use it to "spout off" on issues that are of interest to me, and hopefully to my readers. So here we go....