This is a shout out to all those hard-working, underpaid and unappreciated compliance folks in the securities and advisory industries who just can’t take the animosity of their co-workers, clients and/or bosses any longer and are looking for a career change. It appears as if your friends at the Securities and Exchange Commission have come up with an attractive severance package for you.
According to a September 17 “RIA Compliance Alert” from Advanced Regulatory Compliance, Inc. in Beverly Hills, CA, the Commission has created an “Office of the Whistle Blower,” for folks just like you. “As a result of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act,” reports ARC, “the SEC is statutorily required to pay awards to whistleblowers, including industry insiders.”
According to ARC, to qualify for such an award: “Information provided to the SEC must: (1) be provided voluntarily, (2) consist of original information pertaining to possible securities law violations not currently known to the SEC, and (3) lead to a successful enforcement action resulting in more than $1,000,000 in ordered sanctions. Under the program, individuals are enticed to come forward with the allure of a monetary reward of up to 30% of any resulting enforcement action.”
In case math isn’t your strong suit, that’s a minimum of $300,000 to a whistleblower, with the potential for much more, depending on the size of the sanction that results from your whistling.
(See Melanie Waddell’s article, SEC Gives First Compliance Employee a Whistleblower Award)
This windfall is available to any “officers, directors, trustees, partners, and/or employees whose principal duties involve compliance, including accountants and third-party firms, may qualify as whistleblowers so long as they: (1) first report the possible violations of federal securities laws to the appropriate internal personnel, and (2) wait at least 120 days before reporting the activity to the SEC.”
Don’t qualify under any of those descriptions? Don’t despair: Your deal is even better. ARC tells us that: “Most other individuals not listed above are free to tip off the SEC at any time.” So you don’t even have to put your firm on notice of its infraction, let alone give them time to correct it.