On July 29, Gary Gensler, Chair of the U.S. Securities and Exchange Commission (SEC), delivered keynote remarks at the National Whistleblower Center’s (NWC) National Whistleblower Day 2021 celebration. Gensler spoke of the critical role whistleblowers play in SEC enforcement efforts and reemphasized his commitment to the agency’s whistleblower program. He also revealed that he has directed staff to review the whistleblower program in order to improve its efficiency and effectiveness.
“The tips, complaints, and referrals that whistleblowers provide are crucial to the Securities and Exchange Commission as we enforce the rules of the road for our capital markets,” stated Gensler. “Each week, when I see the Commission’s enforcement actions, I’m reminded how the whistleblower program helps us be better cops on the beat, execute our mission, and protect investors from misconduct.”
“I’ve asked staff to examine whether and how the program can be further strengthened to ensure misconduct within the remit of the SEC is identified, addressed, and stopped,” Gensler continued. “We must ensure that whistleblowers are empowered to come forward when they see misbehavior and that they are appropriately compensated according to the framework established by Congress, and that those who report wrongdoing are protected by retaliation. I also believe we should look for opportunities to continue to reduce processing times in SEC whistleblower award determinations.”
In the decade since it was established, the SEC Whistleblower Program has been an immense success. Whistleblower disclosures have allowed the SEC to recoup nearly $3 billion in monetary sanctions and the whistleblower program has awarded approximately $942 million to 186 individuals.
Furthermore, the whistleblower program is in the midst of a record year. Since the 2021 fiscal year began on October 1, 2020, the SEC has awarded approximately $380 million to 80 individuals – both fiscal year records.
However, in September 2020, the SEC approved a number of rule changes to its whistleblower program. A number of these changes, including altered rules on “related-action” awards and stricter guidance on awards for independent analysis, were criticized by whistleblower advocates.
“We are pleased to hear that Chair Gensler and his staff are reviewing the SEC’s highly successful whistleblower program,” said NWC Executive Director Siri Nelson. “While the program has been an immense success, there are areas, such as the processing time for award claims, which need improvement. The SEC Whistleblower Program should be consistently reviewed to ensure that it best protects whistleblowers and serves the interest of the American public.”
“NWC plans on engaging in the discussion around potential reforms and will issue formal comments soon after National Whistleblower Day,” added Nelson. “We would be happy to meet with the Chairman, the Commissioners, and other members of the SEC Commission Staff.”
Before being confirmed as SEC Chair, Gensler pledged strong support for the agency’s whistleblower program. In a series of written answers to questions filed by Senator Chuck Grassley (R-IA), Gensler stated: “If confirmed to lead the SEC, I will build on the work of past Chairs to ensure continued strength in the whistleblower program.”
The National Whistleblower 2021 celebration continues on July 30 with speeches and panels featuring high profile whistleblowers. RSVP here for the event.