NewYorkNY Attorney General Eric Schneiderman recently announced his plans to propose legislation that would create a whistleblower incentive program at the state level.  The proposal, titled the Financial Frauds Whistleblower Act, would provide monetary awards to eligible individuals who report original information about illegal activity in the banking, insurance, and financial services industries.  The Financial Frauds Whistleblower Act also would enhance anti-retaliation protection for employees who report suspicious or illegal activity.  Additionally, the proposal provides for confidentiality for whistleblowers.

Although the text of the proposal is not yet available, it appears that the state’s bounty program would largely mirror the incentive program established under Dodd-Frank Act.  Steven J. Pearlman, co-chair of Proskauer’s Whistleblowing & Retaliation practice group, was quoted on the practical implications of the proposed program in an article on Law360, stating that whistleblowers will consider “who’s going to pay out faster, and who’s going to pay out more” when deciding whether to report a tip to the state or federal agency.  The AG’s announcement also attracted attention from other media outlets, including the Wall Street Journal (subscription required), which noted in part that the state program may increase payouts in banking cases, which are subject to caps under federal law.

“This law will be the strongest, most comprehensive in the nation, and is long overdue for a state with the world’s most important financial markets,” AG Schneiderman stated in his press release.

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Photo of Lloyd B. Chinn Lloyd B. Chinn

Lloyd B. Chinn is a partner in the Labor & Employment Law Department and co-head of the Whistleblowing & Retaliation Group. He litigates employment disputes of all types before federal and state courts, arbitration tribunals (e.g., FINRA, JAMS and AAA), and before administrative…

Lloyd B. Chinn is a partner in the Labor & Employment Law Department and co-head of the Whistleblowing & Retaliation Group. He litigates employment disputes of all types before federal and state courts, arbitration tribunals (e.g., FINRA, JAMS and AAA), and before administrative agencies in New York and across the country. Lloyd’s practice ranges from litigating compensation disputes to defending whistleblower, discrimination and sexual harassment claims. Although he represents employers in a wide range of industries, including law, insurance, health care, consulting, media, education and technology, he focuses a substantial portion of his practice on the financial services sector. He has tried to final verdict or arbitration award substantial disputes in this area.

Due to Lloyd’s litigation experience, clients regularly turn to him for advice regarding the full range of employment matters, including terminations, whistleblower policy and procedure, reductions in force, employment agreements, and employment policies. For example, in the wake of the financial crisis, he has counseled a number of firms through reductions in force and related bonus and deferred compensation disputes. Lloyd has also been retained to conduct internal investigations of allegations of workplace misconduct, including claims leveled against senior executives.

Lloyd has represented global businesses in matters involving Sarbanes-Oxley and Dodd-Frank whistleblower claims. He has taken an active role in the American Bar Association on these issues, currently serving as Co-Chair of the Whistleblower subcommittee of the ABA Employee Rights and Responsibilities Committee. Lloyd has spoken on whistleblowing topics before a numerous organizations, including the American Bar Association, ALI-ABA, Association of the Bar of the City of New York, and New York University School of Law. He has testified twice before Congressional subcommittees regarding whistleblower legislation and has also published blog postings, articles and client alerts on a variety of topics in this area, including the Dodd-Frank Act’s whistleblower provisions. Lloyd is a co-editor of Proskauer’s Whistleblower Defense Blog, and he has been widely quoted by on whistleblower topics by a number of publications, including the New York Times, the Wall Street Journal, the National Law Journal and Law 360.

Lloyd has also become active in the International Bar Association, presenting on a variety of subjects, including: the #MeToo movement, the COVID-19 pandemic and employment law, and cross-border harmonization of employment provisions in transactions. Lloyd also hosts a quarterly roundtable discussion among financial services industry in-house employment lawyers. He has also published articles and given speeches on a variety of other employment-law topics, including non-solicitation provisions, FINRA arbitration rules, cross-border discovery, e-discovery, and the use of experts.

Photo of Allison Martin Allison Martin

Allison Martin is a senior counsel in the Labor & Employment Law Department. Allison represents employers in a wide range of employment litigation matters, including employment discrimination, harassment and retaliation lawsuits arising under federal, state and local statutes; wage-and-hour claims; defamation and tort…

Allison Martin is a senior counsel in the Labor & Employment Law Department. Allison represents employers in a wide range of employment litigation matters, including employment discrimination, harassment and retaliation lawsuits arising under federal, state and local statutes; wage-and-hour claims; defamation and tort claims; and breach of contract claims. An experienced litigator, she has secured significant victories for clients in federal and state courts at the trial and appellate levels, as well as in arbitration tribunals. In addition to single-plaintiff cases, Allison’s practice also includes defending against nationwide class and collective action lawsuits. She also has significant experience with EEOC proceedings, including representing clients in connection with EEOC Commissioner Charges and investigations concerning alleged claims of systemic discrimination.

Allison also counsels clients on a broad range of employment matters, including advising on investigations, employment agreements, employment policies and procedures, and employee terminations and discipline. She also has significant experience conducting high-profile internal investigations involving allegations of discrimination, harassment and other workplace misconduct.

Allison has an active pro bono practice focused on criminal justice, domestic violence and animal rights issues.

Earlier in her career, Allison served as a law clerk to Magistrate Judge Katharine Parker in the U.S. District Court for the Southern District of New York.

At Seton Hall University School of Law, Allison was an Articles Editor for the Seton Hall Law Review. Allison also interned for Chief Judge Garrett E. Brown (Ret.) of the U.S. District Court for the District of New Jersey while in law school.