Can the SEC Bring Enforcement Actions Against International Schemes?

The SEC’s whistleblower program allows individuals from any country to submit tips about potential securities law violations, including international schemes.

If the information provided by a whistleblower leads to a successful enforcement action resulting in monetary sanctions over $1 million, the whistleblower may be eligible for an award ranging between 10% and 30% of the collected sanctions.

However, the SEC’s ability to enforce actions against international schemes depends on various factors, such as jurisdiction, cooperation between regulatory authorities, and the nature of the alleged misconduct.

International whistleblowers who report potential securities law violations, including those involving international schemes, can receive protection under the Dodd-Frank Act. This act provides several key protections for whistleblowers:

1. Anonymity: Whistleblowers can submit anonymous tips to the SEC if they are represented by a U.S. attorney. The attorney will communicate with the SEC on behalf of the whistleblower, preventing their identity from being exposed.
2. Anti-Retaliation: Prohibits employers from retaliating against whistleblowers for reporting potential securities law violations to the SEC. Retaliation can include demotion, harassment, termination, or other forms of discrimination. If an employer retaliates against a whistleblower, the whistleblower may have the right to file a lawsuit against the employer and seek remedies such as reinstatement, back pay, and compensation for litigation costs, including attorney’s fees.
3. Confidentiality: The SEC must keep the information provided by whistleblowers confidential, consistent with the need to conduct an adequate investigation. The SEC is prohibited from disclosing a whistleblower’s identity without their consent, unless the disclosure is required in connection with a court proceeding or to another government agency.

These protections apply to whistleblowers regardless of their location, as long as the reported misconduct involves U.S. securities laws or has a significant impact on U.S. investors or markets. It is always advisable to consult with an attorney experienced in SEC whistleblower matters to understand the full extent of protections available in a specific situation.

If you observe a violation of securities law, it is within your rights to bring it to light and contribute to meaningful change. When you take such action, you play a vital role in preserving the sanctity of our financial systems, and you may qualify for substantial monetary rewards and immunity against reprisals under U.S. securities legislation.

At Kohn, Kohn & Colapinto, we are prepared to lend our expertise and guidance throughout your journey. Our commitment lies in safeguarding your legal rights and ensuring appropriate compensation for the potential risks you encounter. Stand up for justice, reach out to us today.