The Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank") was enacted July 21, 2010. Among other things, it added new Section 21F to the Securities Exchange Act of 1934 ("Exchange Act"). This Section establishes a whistleblower program that directs the SEC (the "Agency") to pay monetary awards, or what has been viewed as "bounties," to whistleblowers who voluntarily provide the SEC with original information about violations of the securities laws. If the original information results in the SEC obtaining monetary sanctions exceeding $1 million, the whistleblower can recover between 10 percent and 30 percent of the monetary penalties. The Section also sets forth a robust anti-retaliation framework for whistleblowers. For a detailed discussion of Dodd-Frank's anti-retaliation provisions, please click here to see our earlier Alert, "Financial Regulators Set Out to Get Their Man: Federally Mandated Bounties and Anti-Retaliation Provisions Designed to Regulate the Financial Services Industry."

Consistent with the Congressional directives, the SEC has proposed Regulation 21F to implement Section 21F of the Exchange Act. The proposed regulations, as well as the proposed forms to be used in connection with the whistleblower program, are voluminous and total 181 pages. Despite the length and scope of the proposed regulations, the SEC requested comments on a very aggressive timetable-on or before December 17, 2010. However, given the substantial number of comments received and meetings held with the SEC on this subject, the timeline apparently did not dissuade those with an interest from being heard.

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