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NY AG Proposes Whistleblower Awards, SEC Investigates Meddling

New York’s Attorney General, Eric Schneiderman, is asking the New York legislature to implement a whistleblower program similar to that of the SEC, according to Bloomberg. The proposal would offer whistleblowers 10 to 30 percent awards in cases where collected fines exceed $1 million, the same parameters as the SEC program. Bloomberg notes that “whistle-blowers have turned to Schneiderman saying they were frustrated with delays and red tape at the SEC” and the currently pending case against Barclays and a recent case against BlackRock were first submitted to the SEC.

The Wall Street Journal reports that the SEC is investigating whether companies are using employment agreements to silence whistleblowers. The article suggests that some employment agreements seek to limit an employee’s ability to report wrongdoing and some even seek to disgorge the proceeds of any whistleblower awards. The probe reportedly seeks “every nondisclosure agreement, confidentiality agreement, severance agreement and settlement agreement they entered into with employees since Dodd-Frank went into effect, as well as documents related to corporate training on confidentiality.”