Last week, the SEC announced that Activision Blizzard Inc. (a video game development and publishing company) “agreed to pay $35 million to settle charges that it failed to maintain disclosure controls and procedures to ensure that the company could assess whether its disclosures pertaining to its workforce were adequate.”
The SEC order also found that the company “violated an SEC whistleblower protection rule.”
In summary fashion, the SEC order finds:
Whistleblower award, a non-FCPA, FCPA enforcement action, and an open question.
It’s all here in the Friday roundup.
Whistleblower Award
Recently, the SEC announced “an award of more than $37 million to a whistleblower whose information led to a successful SEC enforcement action and a related action.”
The Dodd-Frank Act enacted in July 2010 contained whistleblower provisions applicable to all securities law violations including those under the Foreign Corrupt Practices Act.
In this prior post from July 2010, I predicted that the whistleblower provisions would have a negligible impact on FCPA enforcement. As noted in this prior post, my prediction was an outlier (so it seemed) compared to the flurry of law firm client alerts predicting that the whistleblower provisions would have a significant impact on FCPA enforcement. Many FCPA Inc. participants seemed so eager for a marketing opportunity to sell compliance services, that some even called the generic whistleblower provision the FCPA’s “new” whistleblower provisions.
In this opinion, the Second Circuit recently upheld the SEC’s denial of a whistleblower award in connection with a Foreign Corrupt Practices Act enforcement action.
As framed in the Court’s opinion: “John Doe petitions for review of an order of the Securities and Exchange Commission (“SEC”) denying him a whistleblower award. […] In general, federal law directs the SEC to pay a monetary award to a whistleblower when that whistleblower “voluntarily provided original information to the Commission that led to the successful enforcement” of “any judicial or administrative action brought by the Commission under the securities laws that results in monetary sanctions exceeding $1,000,000.” But the SEC may not make an award “to any whistleblower who is convicted of a criminal violation related to the judicial or administrative action for which the whistleblower otherwise could receive an award.”
Settled, not a victim, and monitor reports. It’s all here in the Friday roundup.
Settled
As highlighted in this prior post, in 2021 Shaquala Williams (a former employee of JPMorgan in New York city) filed a civil complaint in federal court (S.D.N.Y) against JPMorgan in connection with (at least in part) compliance obligations imposed upon JPMorgan in connection with resolution of its 2016 FCPA enforcement action. JPMorgan responded (see here) by filing a motion for summary judgment which was mostly denied by Judge Jed Rakoff who set a trial date for November 2022.
As reported here, the parties have reached an agreement to resolve the matter.
