As reported by Ryan Barber of the National Law Journal, the Trump administration could change the trajectory of the SEC whistleblower office, potentially halting the SEC’s recent strict scrutiny of potential impediments for whistleblowers.
The article discusses the SEC’s recent imposition of fines on two companies for their use of severance agreements that required employees to waive their right to an award for participation in the agency’s whistleblower program. According to the SEC, this was a “groundbreaking enforcement activity” to protect the “key tenet” of the program.
Barber questions how vigorously the SEC will pursue whistleblower protection with President-elect Donald Trump in office and new leadership at its helm (on November 14, Mary Joe White announced her plan to resign as Chair of the SEC before Mr. Trump takes office). Major players in the Trump transition team (including former Republican SEC Commissioner, Paul Atkins) have protested the large fines levied by the agency and have called for de-regulation. While the SEC’s whistleblower program is likely to remain largely unchanged, Barber believes that the Trump administration could revisit some agency policies concerning whistleblowers, including whether tipsters should be required to first report internally to employers before contacting the SEC. We will be closely monitoring these developments after inauguration day.