SEC Dings Employer For Trying To Limit Dodd-Frank Bounty Hunter Award

September 20, 2023

What's New

The Securities and Exchange Commission has fined privately held energy company Monolith Resources $225,000 for using a severance agreement that allegedly deprived departing employees of the ability to qualify for whistleblower awards under the Dodd-Frank financial reform law.

Monolith has agreed to the SEC’s September 8, 2023, cease and desist order and has modified its separation agreement to exempt whistleblower bounties from its prohibition on departing employees’ awards. Monolith also will notify employees who had signed the agreement that it does not limit their ability to obtain a whistleblower bounty payment.

The SEC claimed in the enforcement action that the severance agreements discouraged employees’ participation in whistleblower programs by denying them the financial incentives that encourage people to inform the SEC of potential violations.

The SEC announced that it has reached a similar settlement with CBRE, a real estate services and investment firm.

What It Means

The Monolith settlement is an important reminder that releases limiting any kind of monetary recovery are subject to SEC scrutiny. While this is not the first time that the SEC has pursued such a case, the Monolith and CBRE settlements indicate the SEC’s ongoing intent to prioritize its whistleblower program.

What You Should Do

Employers using releases that limit departing employees’ monetary recoveries may wish to review their policies in light of these two settlements. CWC members can consult CWC staff through MemberAssist at [email protected].

RELATED CONTENT

Add

Data pager
Data pager
1 2 3 4 5 6 7 8 9 10 ... Page size: 5 10 20 50 Change page size 271 items in 55 pages

Show all 271

SEC Dings Employer For Trying To Limit Dodd-Frank Bounty Hunter Award

Sep 20, 2023 – The SEC has fined a company $225,000 for using a separation agreement that the agency alleges deprived departing employees of being able to exercise their “bounty hunter” rights under the Dodd-Frank financial reform law.

Whistleblower Activity Under Federal Laws Increased in FY 2023

Mar 4, 2024 – Whistleblower tips and complaints surged in FY 2023 across federal agencies, including DOJ, SEC, CFTC, and OSHA, with a rise in retaliation cases. These reports may lead to financial rewards for whistleblowers under certain laws.

NHTSA Finalizes Rules For Bounty Hunter Program

Jan 13, 2025 – The NHTSA has finalized a new whistleblower bounty program, offering awards of 10%-30% for original information leading to enforcement actions exceeding $1 million, effective January 16, 2025.

Labor Solicitor’s Report Highlights DOL Enforcement Against Coercive Employment Contracts

Oct 30, 2024 – The Solicitor of Labor has released a report summarizing its enforcement against coercive employment contracts, including those provisions that might chill workers in exercising their rights under employment laws DOL enforces.

Federal Court Temporarily Blocks FTC’s Controversial Noncompete Rule

Jul 11, 2024 – A federal district court in Texas has temporarily enjoined the FTC’s new rule banning most noncompete agreements from going into effect until the court rules on the merits of a legal challenge brought by business groups.

Subscribe to CWC's Updates and Events

CLICK TO SIGN UP

New Tab

Resources

Our library of sources helping you understand and manage your workplace requirements and risks.

Data Center

Metrics and dashboards guiding you to make statistics and research-driven decisions.

Events

Learn and network at events focused on compliance policy, practice, and strategy.

Diversance Connect

Helping members find and connect with thousands of outreach and recruitment sources.