No sooner were the election results tabulated when we received calls from two whistleblower clients, both anxious about how a Trump presidency effects their case and whistleblowers generally. Both have a right to be concerned but there isn’t much to report yet. Here is what we know.
Dodd Frank and the SEC Whistleblower Program
The Dodd Frank Wall Street Reform and Consumer Protection Act was originally proposed in 2009 by President Obama. Passed in 2010, the law was supposed to prevent another financial meltdown like the one that occurred in 2007 – 2008. Since its passage, many in Congress have claimed the law doesn’t have enough teeth while many Republicans have sought its repeal. With the election of Donald Trump, chances for repeal or major overhaul cause concern. For the first time in many years, the Republicans control the House, Senate and Oval Office.
Earlier today, the Wall Street Journal reported that Trump was seeking repeal of Dodd Frank. A full repeal would eliminate the Consumer Financial Protection Bureau (CFPB) and the SEC Whistleblower Program.
While we are certainly concerned, Trump has never appeared to be a fan of big banks or illegal behavior. It is more likely that financial regulations will be eased, especially for community banks. The SEC Whistleblower Program is also likely to survive even if there was a full repeal of Dodd Frank.
Trump has to be careful. He was elected on a waive of populist revolt. Streamlining regulations and making it easier for U.S. businesses to grow would be seen as positive. Dismantling the one agency that stands up for the little guy – the CFPB – or supporting corrupt banks and other Wall Street institutions could backfire, however.
The False Claims Act
The gem of all whistleblower legislation is the False Claims Act. On the books since 1863, the law has become very popular. Although big business, big pharma and the U.S. Chamber want to gut the law, many Republicans actively support the law.
Prior to the election, the Chamber’s Institute of Legal Reform said the Act “incentivizes a host of baseless litigation by private relators, enticed by the prospect of using the FCA’s penalty provisions to coerce enormous settlements.” The Chamber completely ignored the fact that whistleblowers have helped the government and taxpayers recover billions of dollars each year.
We know that there are several bills making their way through the House that would essentially gut the law under the guise of “reform.” With big wins in the House for Republicans, we remain concerned. Once again, it is still too early to tell. Despite activity in the House, President-elect Trump and his transition team have been silent on the Act.
Overall, whistleblowers should certainly be concerned. Until concrete proposals are released, it is hard to predict how the new administration will proceed. Even if Trump does decide to weaken or repeal existing whistleblower laws, those laws could remain on the books for a very long time. My prediction is that Trump tackles tax reform, the Affordable Care Act and infrastructure needs first.
Until there is actual legislation before Congress, the best course of action is to let your elected officials and the President elect know how you feel. Never before has there been such a need for whistleblowers.
This election was so unique that politicians aren’t likely to forget in the near future just how pissed off and angry the average American has become. Their anger and frustration isn’t just directed at our political institutions, it is also aimed at greed, corruption and the status quo. Reminding our elected officials that we won’t stand for a return to the status quo can’t hurt.
MahanyLaw – Proudly Representing Whistleblowers
We believe that despite the inevitable attacks and legislative “reform” attempts, whistleblowers will remain an important part of our judicial landscape. That said, we still suggest would be whistleblowers err on the side of caution and file their claims as soon as possible.
Under the False Claims Act, whistleblowers are entitled to up to 30% of whatever the government recovers from wrongdoers. The Act also protects against illegal retaliation. To earn your award and do your part to “Make America Great,” give us a call. All inquiries are protected by the attorney-client privilege and kept confidential. For more information, contact attorney Brian Mahany at or by telephone at (direct).
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