Armed with whistleblower tips, SEC cracks down on coronavirus misconduct
The novel coronavirus outbreak and its economic fallout are proving to be a bonanza for whistleblower lawyers as the U.S. securities regulator cracks down on a range of related misconduct by companies touting sham cures to misuse of federal aid.
The Securities and Exchange Commission fielded about 4,000 complaints from mid-March to mid-May, a 35% increase on the year-ago period, Steven Peikin, the agency's co-head of enforcement, said this month as cases of COVID-19, the respiratory illness caused by the coronavirus, shot up.
That is creating work for lawyers who help whistleblowers navigate the SEC's bounty program for tipsters whose information leads to penalties of more than $1 million for offenders. The agency is already working with some tipsters, lawyers said.
"Unfortunately, fraudsters often seek to exploit difficult situations like the ongoing pandemic for their own gain. The SEC frequently relies on the tips that we receive from the public," an SEC spokeswoman said.
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