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Khuzami: whistleblowers shouldn't bypass compliance in a rush for SEC cash

Oct 26 2010 Ted Knutson, Compliance Complete recommended

The Securities and Exchange Commission wants to write rules for its bounty program so whistleblowers do not bypass their employers' internal compliance procedures in a rush for cash, SEC enforcement director Robert Khuzami said Monday. Section 922 of the Dodd-Frank Wall Street Reform and Consumer Protection Act expanded the areas for which the SEC can pay bounties for providing original information that results in significant financial recoveries by the agency. Speaking at a seminar at Georgetown University in Washington, DC, Khuzami pointed to his division's top post-meltdown priority as a deep dive into the investment adviser world. Khuzami said number two on his list is an increased focus on large-scale insider trading and market manipulation as better technology makes these types of frauds easier to detect. With improved technology and enhanced powers under the Dodd Frank Act, the SEC will be able to see derivatives and debt transactions as clearly as it can look at equity

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