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The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”) became law on July 21, 2010. A primary purpose of the Act is to further incentivize whistleblowers to report potential violations of federal securities laws, including the Foreign Corrupt Practices Act (“FCPA”), to the SEC. Section 922 of the Act requires the SEC to pay whistleblowers an award, between 10-30%, for original information about a violation that leads to a successful action resulting in monetary sanctions exceeding $1 million. The Act therefore provides yet another set of liabilities for government contractors doing business internationally, and creates a whole new class of would-be private attorneys general attempting to enforce the FCPA.
For a further discussion of the Act and its implications, click here to read Sheppard Mullin partner Peter Menard's recently published article, "The Dodd Frank Act: A Guide to the Corporate Governance, Executive Compensation, and Disclosure Provisions." This article appears in Business Law News, Published by the Business Law Section of the State Bar of California.
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