An American government agency called the Securities and Exchange Commission launched a program that would allow the public to report American companies that are involved in fraudulent acts, and they will be rewarded with money after each successful report. The program, called the SEC Whistleblower Program, has become one of the most successful programs launched by the SEC, and they were able to recover billions of dollars’ worth of penalties, thanks to the people who keep on reporting these businesses. The SEC is an independent agency of the government of the United States, and they are looking after the implementation of securities laws, and they are managing and regulating the securities industry in the country. Dealing with fraudulent companies have become a headache for the agency, and they are thanking the public for their continued support to the government program.
Many companies are trying to evade the SEC because of the fees that they would need to pay, but the SEC said that for the companies to continue enjoying their operations, they would need to work with the government and pay all of their dues. These companies are operating abroad, mostly in the United Kingdom and Canada, but people who are interested in the reward provided by the SEC is what makes their operations difficult. The public is promised millions of dollars just to report one fraudulent activity, and they will be hunting these companies just for the money.
What is the SEC Whistleblower Program?
Started more than twenty years ago, the SEC Whistleblower Program transformed to become the premier bounty-hunting operations of the agency. SEC encourages the people to cooperate with them, and report any suspicious corporate activities that they will notice in their areas. Most of the reports are coming from overseas, and the SEC is taking different steps on how they can address the report. Anyone who will be reporting fraudulent acts would be required to work with a law firm and a whistleblower attorney, and they would need to sign a declaration that all of the information provided is accurate.
The primary targets of the operation are companies that owe the United States government. They would look for companies that have dues of more than $1 million, and they will be using all of their networks to check their locations and ultimately collect the money. Reports are coming from 114 countries, and the SEC would immediately dispatch an investigating team once the report has been confirmed.
Why pushed the government to approve this program?
The fraudulent nature of other businesses that are registered in the United States but are not paying their dues is what pushed the SEC to become stricter when it comes to their collection policy. They also resorted in using the assistance from the public to trace down these company owners who are trying to evade the United States government.
What are the three main stages of reporting a fraudulent company?
The whole program is divided into three separate phases. The first one involves the submission of a complaint, and the person who is reporting the fraudulent company should sign a declaration that the documents and the testimonies are true. Those who are providing fake documents might be charged with perjury. The next thing that the SEC will do is to conduct an investigation about the allegation. If the allegation is proven, the whistleblower will receive an award.
How many people have already used the program to report fraud?
Thousands of individuals have used the Whistleblower program, and they were given more than $300 million. As a benefit, the SEC was able to collect $1.4 billion from fraudulent companies. The highest amount of reward that the SEC has given away is worth $50 million, and more people are trying to join the bounty-hunting activity to collect their rewards. Those who wanted to join will be given their lawyer to help them with reporting the the company.
How the SEC Whistleblower Program will fare in the future?
The SEC Whistleblower Program is a success, and the agency stated that the program will continue until all of the fraudulent companies have been penalized. They are also encouraging the public to continue reporting the companies that are trying to evade their dues from the American government. The reward given by the SEC is really the drawing factor, and many people are interested in joining the hunt because of the huge prizes that await them.