‘A Sleight of Hand’: Whistleblower Lawyers Recoil at SEC’s New Rules

The National Law Journal published an article on Sept. 23, 2020 by C. Ryan Barber including reactions of the private bar to new rules for the SEC whistleblower program. Jordan Thomas was consulted and his quotes used in anchor position.

The article discusses the adoption of the new rules by a “party line” 3-2 vote, contrasting the views of the dissenting Commissioners and others to the chief proponent of the changes, former Chairman Jay Clayton. Clayton represented the changes as scaled-back and largely redundant codification of existing authority that would improve the SEC’s processes.

Others, including Jordan, disputed this. For example, former program chief Sean McKessy decried the “remarkable spin” about the new rules, which he called a “net-negative for whistleblowers.” Similarly, Jordan argued that a new rule providing the SEC with discretion about award sizes was ambiguous, and that the SEC’s appeal for trust was unlikely to win over prospective whistleblowers. “Americans . . . distrust the government regardless of administration. And for whistleblowers, whose risk of retaliation and black-listing is so high, that distrust is even higher,” he said. “[T]he more uncertainty there is in the whistleblower program, the fewer people there are who will want to participate in it.”