Whistleblower Provisions: SEC Issues Final Rules Implementing the Dodd-Frank Whistleblower Provisions

Sullivan & Cromwell LLP - June 1, 2011

On May 25, 2011, the Securities and Exchange Commission voted 3 to 2 to approve the final rules implementing the whistleblower provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act. In November 2010, the SEC issued proposed rules and solicited comments, resulting in extensive submissions from the corporate community and whistleblower advocacy groups. One of the principal subjects addressed by the public commentary was whether the SEC should require that a whistleblower first make a report through internal corporate compliance channels in order to be eligible for a monetary award. In response to the comments, the SEC made a number of revisions to the proposed rules, including changes designed to encourage internal reporting.