Hagens Berman Endorses 'Wall Street Tip-Off Law' to Fight Securities Fraud

SEATTLE, Aug. 13 /PRNewswire/ -- Hagens Berman Sobol Shapiro LLP, a leading qui tam litigation firm, says a new law giving financial regulators a potent tool for investigating and rooting out securities fraud is an important step toward reining in corporate malfeasance.

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Widely known as the "Wall Street tip-off law," the new tool comes out of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The law empowers the U.S. Securities and Exchange Commission to award between 10 percent and 30 percent of any monetary sanctions of more than $1 million to whistleblowers who provide information leading to a successful SEC enforcement. More information about the new law can be found here.

Steve W. Berman, managing partner of Seattle-based Hagens Berman, said the new law is a step in the right direction.

"Whistleblowers play a critical role in many securities fraud investigations, yet many are hesitant to come forward because they rightly fear retaliation from their employers," said Berman, whose firm has handled many whistleblower cases over the years. "The Wall Street tip-off law gives them an incentive to risk their careers to expose corporate wrongdoing."

In addition to providing a monetary incentive to report almost any type of securities law violation to the SEC or the Commodities Futures Trading Commission, the new law enhances existing whistleblower confidentiality and retaliation-protection provisions in the federal Sarbanes-Oxley Act and the False Claims Act.

Under the new law, whistleblowers can report fraud anonymously and employers are prohibited from firing, demoting, suspending, threatening, harassing or discriminating against whistleblowers.

Merely providing information to investigators isn't enough to secure a monetary award. According to the new law, whistleblowers will only receive awards if the information provided leads to a successful SEC or CFTC enforcement.

Regulators will determine the extent of all awards based on the significance of the information given and the assistance given by the whistleblower and the whistleblower's legal representative, among other factors.

The use of whistleblowers has its origins in a legal principle known as qui tam, a shortened version of the Latin phrase, "qui tam pro domino rege quam pro se ipso in hac parte sequitur." The phrase translates to "he who brings a case on behalf of our lord the King, as well as for himself."

"Whistleblowers play a pivotal role in keeping powerful interests on the straight and narrow," Berman, a noted qui tam expert, said. "Their value can't be underestimated when it comes to fighting fraud and exposing corporate malfeasance."

Hagens Berman has a long history of qui tam expertise. The firm's successes include some of the largest cases and settlements in United States history, including the historic tobacco settlement and billions of dollars in settlements with pharmaceutical, financial and other industries.

Hagens Berman leverages the knowledge it gained from past successes in the health care field, such as its $350 million settlement against McKesson Corp. and its $125 million settlement against major pharmaceutical companies through the Average Wholesale Price litigation, to its advantage in health care fraud qui tam suits. The firm is involved in several such suits, some currently under seal and some actively litigated without help from the government.

Hagens Berman's past whistleblower successes include a suit against an ambulance company that resulted in the second-largest settlement ever in the ambulance industry; representation of a health care finance consultant who blew the whistle on Medicare Outlier fraud and helped recover millions to the federal treasury; representation of a former consultant at a big four accounting firm whose office perpetrated a fraudulent billing scheme on the U.S. Justice Department; and representation of a defense industry employee whose company provided substandard gyroscopes for Air Force fighter jets.

About Hagens Berman

Seattle-based Hagens Berman Sobol Shapiro LLP is a consumer-rights class-action law firm with a deep track record in qui tam, or whistleblower, litigation. Hagens Berman has been included in the National Law Journal's Plaintiffs Hot List three times. The firm has offices in San Francisco, Chicago, Boston, Los Angeles, Phoenix and Washington, D.C. Founded in 1993, HBSS continues to successfully fight for consumer rights in large, complex litigation. More about the law firm and its successes can be found at www.hbsslaw.com.

Contact: Mark Firmani, Firmani + Associates Inc., 206.443.9357 or [email protected].

SOURCE Hagens Berman Sobol Shapiro LLP