Former SEC Commissioner Calls for SEC Whistleblower Reform Bill

Washington, D.C. – WEBWIRE – Thursday, June 29, 2023

Allison Herren Lee, Of Counsel at Kohn, Kohn & Colapinto and a former Commissioner of the Securities and Exchange Commission (SEC), is calling for the passage of the SEC Whistleblower Reform Act of 2023. Today, the Harvard Law School Forum on Corporate Governance published an article by Lee entitled “The Bipartisan SEC Whistleblower Reform Bill: Building on Success.”

Lee writes that the bipartisan SEC Whistleblower Reform Act, introduced by Senators Chuck Grassley (R-IA) and Elizabeth Warren (D-MA) on March 15, makes important improvements to the SEC’s hugely successful whistleblower program. Established in 2010, the program has garnered over $6.3 billion in sanctions and awarded over $1.5 billion to whistleblowers.

“If passed, this legislation will help ensure that the SEC Whistleblower Program remains an indispensable tool in the Commission’s efforts to police wrongdoing and protect investors,” Lee writes.

In the article, Lee highlights two of the bill’s key provisions. Most notably, the bill extends whistleblower protections to corporate whistleblowers who report potential securities violations internally but not externally to the SEC. Furthermore, the bill codifies an SEC rule banning restrictive non-disclosure agreements.

“The SEC Whistleblower Reform Act reflects a bipartisan consensus that a strong whistleblower program benefits investors, companies and the public,” writes Lee in conclusion. “The program has helped uncover -- and remediate – serious and costly frauds that might never have otherwise come to light. Having worked in law enforcement for over a decade, and then as an SEC Commissioner helping to oversee the SEC’s Office of the Whistleblower, I know firsthand the value of continued investment in this highly successful program. I hope Congress will act quickly to pass this important legislation.

In March 2023, Lee joined the whistleblower defense firm Kohn, Kohn & Colapinto as Of Counsel after serving as an SEC Commissioner from 2019 until her term expired in July 2022. During her tenure at the Commission, Lee was a champion for stronger whistleblower protections and individual accountability for violations of securities laws. Her current practice focuses on representing whistleblowers reporting securities, commodities, banking and capital markets law violations, including a focus on ESG, governance/audit, securities law, and whistleblowers.

From January-April 2021, Lee also served as the Acting Chair of the SEC. In this role, Lee helped propel ESG issues to the forefront of the agency’s agenda. Among other things, she hired a senior policy adviser for ESG and launched an enforcement task force to evaluate and pursue tips, referrals, and whistleblower complaints on ESG-related issues.

Read: The Bipartisan SEC Whistleblower Reform Bill: Building on Success