Tag: SEC whistleblower

SEC Whistleblower Program Awards Anonymous Tipster

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The Securities & Exchange Commission (SEC) announced that it awarded $17 million to a former company employee whose tip was instrumental in the SEC’s investigation and subsequent enforcement proceeding. No details of the enforcement have been made public.

The award is the second largest payout ever under the SEC’s relatively new whistleblower program. The terms of the program provide anonymity for would-be tipsters to encourage reporting. Based on awards which range from 10-30% of the sanctions the agency secures, it appears that the action brought in between $56 million and $170 million.

This award continues a recent trend of company insiders who have been rewarded for alerting the SEC about potential securities law violations. In the past month alone, $26 million has been awarded to five anonymous tipsters who blew the whistle on companies that were violating securities laws.

Any money paid to tipsters comes from the monetary sanctions of securities law violators, not from harmed investors.

Call a Los Angeles Whistleblower Attorney Today

If you have information that your company is violating securities law, you may be eligible to receive an award if your information leads to sanctions, and your information will remain anonymous.

Contact an experienced Los Angeles whistleblower attorney today for a consultation to discuss your rights and options.

FINRA Staff Continues Focus on Manipulative Trading Activity

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At its 2016 Annual Conference, the Financial Industry Regulatory Authority (FINRA) is urging its brokerage firm members to continue to look for manipulative trading activity, stating that new technology makes it easier to find patterns of violations.

FINRA told conference attendees to keep an eye toward manipulative trading activity such as layering and spoofing, asking firms to detect and root out violations. According to FINRA’s market regulation department, one of its priorities for 2016 is enforcing Rule 15c3-5 of the Securities Exchange Act, which requires firms to restrict market access only to authorized traders. Further, firms are required to monitor for manipulative conduct.

FINRA’s words are more than just talk: in recent months, the regulatory agency has levied fines in excess of $1 million on several member firms for failing to have appropriate controls in place or for failing to stop market manipulation. FINRA fined Wedbush Securities $1.8 million a few months ago, which we blogged about here.

New technology and cross-market surveillance has made it easier to detect illicit activity. Of particular concern to FINRA are algorithmic trading controls that firms have deployed to regulate their trading. FINRA will continue to monitor whether firms have adequate controls in place to shut their algorithm down if it exceeds certain trading limits or malfunctions.

In conjunction, last month the SEC approved a rule requiring algorithmic trading developers to register as securities traders, as part of an ongoing effort to ensure compliance and avoid problematic conduct.

Call a Los Angeles Stock Fraud Attorney Today

If you believe your broker or brokerage firm has engaged in illicit activity, or if you work for a brokerage firm engaged in manipulative trading, you may have certain legal rights either as a plaintiff or as a SEC whistleblower that require your immediate attention.

Contact an experienced Los Angeles stock fraud lawyer today for a consultation to discuss your rights and options.