Whistleblowing Investigations
Workplace investigations into regulatory compliance and whistleblowing complaints are increasingly common. We assist lawyers who are experienced in handling sensitive and high-profile workplace investigations. We work collaboratively with them on behalf of their clients to find the most effective course of action.
Tips for handling whistleblowing investigations:
- Have effective procedures that allow for whistleblowing.
- Establish communication with the whistleblower as soon as possible; don’t risk the employee losing confidence in your whistleblower system.
- Interview the whistleblower at the outset of an investigation, to gather as much detail as possible and help scope the investigation.
- Remember there doesn’t need to be any wrongdoing, but, did the whistleblower believe the wrongdoing was taking place?
- Consider who may be proximate to the allegations; those involved in the misconduct may not always be named by the whistleblower.
- Initiate the internal investigation promptly, if there is sufficient evidence to indicate that a violation has occurred.
- Decide who should be involved in the investigation; the team should include at least in-house legal and/or external counsel and HR (if not proximate to the allegation), and preferably an independent, external investigator/skilled interviewer.
News
SEC Charges Seven Public Companies with Violations of Whistleblower Protection Rule
September 9, 2024 – The Securities and Exchange Commission announced settled charges against seven public companies for using employment, separation, and other agreements that violated rules prohibiting actions to impede whistleblowers from reporting potential misconduct to the SEC. To settle the SEC’s charges, the companies agreed to pay more than $3 million combined in civil penalties.
- Acadia Healthcare Company, Inc., agreed to pay a $1,386,000 civil penalty;
- a.k.a. Brands Holding Corp. agreed to pay a $399,750 civil penalty;
- AppFolio, Inc., agreed to pay a $692,250 civil penalty;
- IDEX Corporation agreed to pay a $75,000 civil penalty;
- LSB Industries agreed to pay a $156,000 civil penalty;
- Smart for Life, Inc. agreed to pay a $19,500 civil penalty; and
- TransUnion agreed to pay a $312,000 civil penalty.