When I think of “whistleblowing,” the first image that pops into my head is one of Fred Flintstone
shouting “Yabadabadoo!” and sliding down a dinosaur tail after a bird – that somehow sounded e
xactly like a steam whistle – releases him from work.
But what should come to mind is something like Fred reporting Mr. Slate to the SEC for insider
trading – and if Fred survived through March 2011, he might get paid by the SEC to do so.
The Dodd-Frank Act now authorizes the SEC to give incentive payments to whistleblowers if the
information they provide the SEC results in successful prosecution or civil suit. What could this
mean? Well, employees now have a monetary encouragement to report infractions to the SEC,
instead of reporting them in-house.
The incentive payments can be significant – between 10% and 30% of penalties paid by the
defendant in the relevant case. The SEC must create rules to implement the Dodd-Frank
whistleblower program by March 2011.
And to see just how pre-historic the Flintstones seem now, watch this video.