Implications of the SEC’s First-Ever Whistleblower Protection Enforcement Action

The SEC has announced its first enforcement action under a rule prohibiting companies from impeding an individual’s efforts to report a potential securities law violation to the SEC.  The Commission’s settlement with KBR over language in its form confidentiality agreement signals that the SEC intends to take a sweeping view of the whistleblower protection rule.  In a guest article, David M. Stuart and Omar K. Madhany, partner and associate, respectively, at Cravath, Swaine & Moore LLP, analyze the decision and suggest steps that companies can take to ensure compliance with the rule.  See also “Preparing for the Increasing Role of Whistleblowers in FCPA Enforcement” (Jan. 21, 2015). 

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