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The SEC whistleblower program is a well tried and tested program. It has dealt out over $1Billion to whistleblowers, paying between 10% and 30% of the money collected. That is an indication of the total fines levied against those companies reported to the SEC.
One wonders the effect of the SEC Final cyber ruling (effective 5th September 2023) on U.S Domestic registrants and Foreign Private Issuers (FPIs). The Final ruling seeks covered registrants to disclose ‘material’ cyber risks and ‘material’ cyber incidents, as evaluated by a ‘reasonable investor’ to the SEC. With the terms ‘material’ and ‘reasonable investor’ being front and center tenets of the final ruling, there is the possibility of the Whistleblower program being an influential part of board compliance.
One wonders how U.S and foreign covered entities will respond to cyber regulatory compliance requirements. If there is the potential for a whistleblower to report compliance concerns to the SEC?
Ted Dziekanowski Rachel V. Rose, JD, MBA Bob Dix
#cybersecurity #cyberriskmanagement #securitiesandexchangecommission #whistleblower
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