In a well-reasoned decision, the U.S. District Court for the District of Massachusetts held that an employee of the New England Investment & Retirement Group, who complained to his employer’s internal compliance department regarding potential securities violations, was fully protected under the Dodd-Frank Act’s whistleblower provision.
The Court rejected the company’s argument that whistleblowers must contact the government (i.e. the Securities and Exchange Commission) in order to be protected. Instead, the Court held that purely internal reports are fully protected under the law.
This decision is consistent with the statutory protections afforded under the Dodd-Frank Act, and it’s reasoning should be fully applicable in other cases. When the Dodd-Frank Act was under consideration by Congress, the National Whistleblower Center specifically requested that the SEC whistleblower provision be amended to include internal reports. In its decision, the U.S. District Court understood the importance of protecting internal whistleblowers, and understood the specific statutory provisions that clearly protect internal reports.
A copy of the decision, issued in the case of Ellington v. Giacoumakis, Case 1:13-vc-11791-RGS (D. Mass.) filed by the court on October 16, 2013, is linked here.