New York Takes Steps to Incentivize, Protect Financial Whistleblowers

New York State Attorney General Eric Schneiderman has taken steps to make it worth a whistleblower’s time and effort to report illegal activity in the financial services sectors – including banking and insurance.

His proposed legislation, called the Financial Frauds Whistleblower Act, promises financial compensation to anyone in the industry who discloses fraudulent activity that leads to a settlement or penalty of more than $1 million. Schneiderman’s bill also calls for complete confidentiality and reiterates government’s intolerance for retaliation. In fact, the proposed Act would make it illegal for an employer to punish an informant.

Of course, whistleblowing and the False Claims Act are hot topics on the national level. Whistleblowing can pay handsomely when someone reports information about government fraud that leads to the US government recouping some of their losses.

Ross Begelman, a longtime successful whistleblower lawyer who has represented informants throughout the United States, believes the chance of successful outcome has a lot to do with how hard a qui tam lawyer is willing to work on the case. If a person suspects wrongdoing, especially fraud being committed against the government, they may be entitled to collect a considerable amount of money – sometimes six or seven figures.

The amount of the reward depends on the type of fraud and how much the whistleblower (and his or her attorney) have done to assist the government in recouping lost funds. Additionally, if the government fails to join the lawsuit before a settlement or penalty is determined, the whistleblower stands to receive a larger pay day. Generally speaking, successful whistleblower can receive up to 25 percent of the amount recovered by the government, if the government joins the lawsuit. If the whistleblower pursues the claim on their own, they may get up to 30 percent. Often, recoveries can amount to millions of dollars.

Suspecting Big Business is trying to silence whistleblowers, the Securities and Exchange Commission is examining corporate regulatory procedures more closely.

The SEC is requesting several documents from corporations suspected of taking inappropriate actions against whistleblowers. Government officials are taking a closer look at agreements such as non-disclosures and employment contracts to see whether they include measures to prevent whistleblowing. Such measures would be illegal and possibly even violations of SEC regulations.

If you have information on fraud being committed against the government, speak up. Start by calling the experienced whistleblower lawyers at Begelman & Orlow, P. C. today for a free consultation about your case.

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