Mike Delikat, founder of Orrick’s Whistleblower Task Force, recently spoke with
The Wall Street Journal [subscription required] regarding the future of the U.S. Securities and Exchange Commission’s Office of the Whistleblower, which was established in 2011 following the passage of the Dodd-Frank Act.
President-elect Trump has vowed to roll back Dodd-Frank when he takes office, but many commentators believe that the success of the whistleblower office should ensure its survival. However, Mike noted that Paul Atkins, who is leading the Trump transition team’s actions on financial regulation, is no fan of large corporate penalties, and that may put a damper on the whistleblower program’s future success.
“If the fines are reduced, and if the bar for who gets fined by the SEC goes considerably up, there will be less attraction to the [whistleblower] bounty provisions, which are derivative of the fines issued,” Mike said, adding, “The most likely outcomes are that the program stays, but expect that the office won’t be as aggressive, not just on the bounty side, but also on confidentiality agreements.”