New Law Encourages Reporting Of Securities Fraud Whistleblower Lawsuits

Get Legal Help Today

 Secured with SHA-256 Encryption

Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

Full Bio →

Written by

UPDATED: Jul 16, 2021

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about legal topics and insurance. Our goal is to be an objective, third-party resource for everything legal and insurance related. We update our site regularly, and all content is reviewed by experts.

Whistleblower lawsuits, also known as Qui Tam lawsuits, expose fraudulent activity against the government and compensate those who report that fraud with a percentage of what is recovered. Given that most Qui Tam lawsuits involve millions – even billions – of dollars, that compensation can be substantial. A new law passed by the Obama Administration is aimed at encouraging those who work in the securities industry to report fraudulent activity – and be paid handsomely for it.

Securities Fraud Whistleblower Lawsuits: The Dodd-Frank Reform Act

The Dodd-Frank Reform Act, part of the Obama Administration’s financial regulatory reform, provides important incentives for those who discover fraudulent activity in a wide range of securities industry jobs such as brokers, branch managers, compliance officers, quantitative analysts and data system programmers, senior managers and even board members.

The Act says that any individual who discloses “original information” that leads to a securities law conviction will be eligible to receive as much as 30% of the total sanctions recovered by the CFTC (Commodity Futures Trading Commission) or the SEC (Securities & Exchange Commission).

The Dodd-Frank Act is similar to existing whistleblower programs to report tax fraud and insider trading and also has an anti-retaliation provision which allows whistleblowers whose employers have retaliated against them by making adverse employment decisions to sue for reinstatement of their job, double back pay, costs and legal fees.

Qui Tam Lawsuits: Who Can Be A Securities Fraud Whistleblower?

Although the Dodd-Frank Act addresses those in the securities industry, almost anyone can file a whistleblower lawsuit. Qui Tam lawsuits fall under the False Claims Act (FCA) which allows any private citizen who discovers fraudulent activity against the government to file a whistleblower lawsuit on the government’s behalf. The whistleblower does not have to be affiliated with the government or have been personally harmed by the actions they are disclosing. However, hiring an experienced Qui Tam lawyer before blowing the whistle is always recommended.

Hiring A Securities Fraud Qui Tam Lawyer

Hiring a Qui Tam lawyer is a critical element as the False Claims Act is complex area of law and the process of filing a Qui Tam lawsuit is very different than filing a traditional lawsuit. In fact, may law firms limit their practices exclusively to whistleblower lawsuits. Contact an experienced Qui Tam attorney before blowing the whistle to make sure that you understand how the whistleblower lawsuit process works, the compensation for which you may be entitled and above all – to make sure that your interests are adequately protected.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption