Is SEC Whistleblower Program Underregulated?

Advertising by lawyers is subject to state bar rules – but not all of the ads inviting tips from potential SEC whistleblowers are by law firms.

“If you look at the advertisements from some of these shady groups, they’re misleading,” said Thomas, who told me he’s seen non-lawyer ads trying to claim credit for whistleblower bounties obtained by lawyers. Thomas, a former SEC assistant director, said his clients tend to be high-level officials, many referred to him by defense firms. But he told me he’s concerned that some whistleblower lawyers are accepting referrals from non-lawyers running misleading ads. “Those groups, they exist for a reason,” he said. “Someone is taking those clients.”