Regulators Offer Insights Into SEC, CFTC, and OSHA Whistleblower Program’s Trends and Priorities


On July 13, 2020, three prominent whistleblower law regulators spoke at PLI’s Corporate Whistleblowing in the Coronavirus Era 2020, which was co-chaired by Orrick partners Mike Delikat and Renee Phillips. With the standard disclaimer that their comments and opinions were their own and not the official comments of their respective agencies, each spoke about their agencies’ whistleblower program’s current progress, challenges, and priorities.

SEC’s Office of the Whistleblower

Jane Norberg, the Chief of the SEC’s Office of the Whistleblower (“OWB”), explained that the OWB’s current priorities include (1) quickly and efficiently reviewing and processing whistleblower award claims by streamlining award and evaluation processes; and (2) continuing to review whistleblower tips for fact patterns of retaliation or attempts to impede whistleblowers from reporting to the Commission. On the latter point, Norberg stated that the SEC will continue to review corporate policies, including codes of conduct and investor agreements, for potential Rule 21F-17 violations.

Norberg reported that since the SEC whistleblower program’s inception, the OWB has received over 33,000 tips from 124 countries. The agency has awarded 86 whistleblowers over $500 million in awards, has recovered more than $2.5 billion, and has returned over $750 million to defrauded investors.

The OWB has received an increased number of tips during the COVID-19 crisis.  Norberg opined that this could be due to workers having more distance from their managers during remote work and/or more time to reflect on corporate actions. Norberg shared that so far, the SEC has investigated at least 5 COVID-19-related fraud actions. Because of this increased reporting activity, the SEC’s Enforcement Division has created a COVID-19 steering committee to actively monitor for these types of cases.

CFTC’s Whistleblower Office

Christopher Ehrman, the Director of the CFTC’s Whistleblower Office, spoke about some emerging issues and priorities for the CFTC in 2020.  He noted that the agency is looking to conclude investigations more quickly. He also mentioned that his office is looking to engage the public more and educate potential whistleblowers on the types of information that are most helpful when submitting a whistleblower tip. To this end, he stated that attorneys representing whistleblowers should feel free to contact his office staff to gain a better understanding of whether a whistleblower tip contains sufficient, quality information to ensure an efficient complaint review process. Ehrman discussed five substantive areas the CFTC is interested in pursuing: virtual currency, foreign corrupt practices, insider trading, Bank Secrecy Act violations, and spoofing.

In terms of COVID-related cases, Ehrman indicated that the CFTC is already receiving complaints alleging fraud in this emerging area. He explained that the CFTC and SEC frequently share information and will continue to do so for these types of cases, which are a high priority for both agencies.

Finally, Ehrman shared some statistics about the CFTC’s whistleblower program. As of July 13, 2020, the agency had received 106 whistleblower applications, had awarded more than $110 million to whistleblowers, and had recovered over $900 million to return to defrauded investors. Roughly a third of the CFTC’s active cases currently involve whistleblowers, according to Ehrman.

OSHA’s Whistleblower Program

In another segment of the PLI conference, Teri Wigger, Assistant Regional Administrator for OSHA Region 2, which covers New York, New Jersey, Puerto Rico, and the Virgin Islands, spoke about recent whistleblower trends before OSHA. Wigger reported that the agency has seen a 50% spike in whistleblower complaints since March. Many of these complaints, she noted, come from essential industry and healthcare workers and involve issues such as the lack of, or improper reuse of, personal protective equipment (PPE).  These whistleblower complaints have evolved over time as OSHA and the CDC have updated their guidance. Wigger noted that OSHA is starting to see more complaints in industries where businesses are beginning to return to work. She explained that reporting work-related injuries related to COVID-19 or requesting guidance from OSHA on an employer’s COVID-19 response are considered protected activity under the Occupational Safety and Health Act.

In response to an audience member’s question, Wigger explained that an employee’s refusal to work may also be deemed protected activity under certain circumstances. Specifically, a work refusal may be protected if: (1) the employee has a reasonable apprehension of injury from a hazardous condition, (2) the employee refuses to work in good faith, (3) the employee has no reasonable alternative to avoid the hazardous condition, (4) there is no time to contact the appropriate regulatory agency, and (5) where possible, the employee has sought correction of the condition from his or her employer.

Finally, Wigger reported that about 30% of all OSH Act complaints result in a violation or settlement, about 50% are dismissed by the agency, and about 20% of complainants withdraw their complaint. OSHA has, and will continue to, prioritize COVID-19-related complaints during the pandemic.

For more information about the July 13th program, please contact Mike Delikat or Renee Phillips. The program was recorded and will be available to PLI members on its website.