Firm Recommends Following IRS Rules for Whistleblowers

On Monday, October 25, Arent Fox LLP submitted a letter to the US Securities and Exchange Commission in response to the SEC's request for comments about proposed rulemaking by the SEC relating to the Dodd-Frank Wall Street Reform and Consumer Protection Act. In particular, the letter comments on the Securities Whistleblower Incentives and Protection Program in Title IX of Dodd-Frank, which gives whistleblowers a bounty payment for information about securities violations at public companies.

As the Dodd-Frank whistleblower provision is modeled on similar IRS rules, Arent Fox suggests the SEC rulemaking adopt additional principles from existing IRS rules. “The SEC should consider adopting a ‘one bite’ rule prohibiting the SEC from deputizing a whistleblower to go ‘back in’ to a public company to look around for more information,” writes Arent Fox. “Such a rule prevents an informant from becoming an instrument or agent of the government and avoids the potential negative evidentiary consequences that might attach as a result.”

Arent Fox also suggests a “no bite” rule, prohibiting compliance personnel from usurping corporate information for personal gain.

To read the entire October 25 letter from Arent Fox to the SEC, please click here.

For further information regarding the whistleblower provisions of the Dodd-Frank Act or other anticorruption matters, please contact the Arent Fox attorney with whom you work or a member of Arent Fox’s International Trade or White Collar and Investigations Practice Groups.

Mark S. Radke
202.715.8431
radke.mark@arentfox.com

Peter V. B. Unger
202.857.6220
unger.peter@arentfox.com

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About Arent Fox:
Arent Fox LLP (www.arentfox.com), with offices in Washington, DC, New York City, and Los Angeles, is a recognized leader in areas including intellectual property, real estate, telecommunications, health care, automotive, sports, white collar, international trade, bankruptcy, and complex litigation. With more than 350 lawyers nationwide, Arent Fox has extensive experience in corporate securities, financial restructuring, government relations, labor and employment, finance, tax, corporate compliance, and the global business market. The firm represents Fortune 500 companies, government agencies, trade associations, foreign governments and other entities.