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New rewards for whistleblowers, new risks for public companies

Overview

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) introduces new cash incentives for corporate employees to report suspected wrongdoing directly to the Securities and Exchange Commission and significantly expands protection of whistleblowers from employment retaliation. The new whistleblower rights and rewards created by the Dodd- Frank Act, effective July 21, 2010, raise new risks for public companies and call for a fresh look at internal corporate compliance programs.

This article discusses how these changes are likely to impact public companies and suggests ways to minimise new corporate risks.

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