As the Ontario Securities Commission ("OSC") inches
towards unveiling its version of its American counterpart's
whistle blower "bounty" program, American whistleblowers
continue to receive significant pay days from the Securities
Exchange Commission (the "SEC") for alerting the SEC to
potential securities law violations.
The proposed OSC whistleblower program, (the "Program")
which we have discussed in detail previously, is expected to
"go live" this spring or summer. The policy also seeks to
encourage company insiders, and other individuals uniquely
positioned to protect investors to come forward with information
they may have about securities violations. While the Program will
also incentivize individuals to come forward with information
through monetary awards, the large pay days for whistleblowers that
are becoming increasingly common in the United States will not be a
part of the Program. Instead the Ontario Program contemplates
whistleblower awards between 5% and 15% of the total monetary
sanctions and/or voluntary payments, up to a maximum of $5 million.
Such an award would only be payable if the whistleblower provided
information to the OSC that resulted in an order for monetary
sanctions and/or voluntary payments totalling $1 million or more.
Despite there not being a potential for awards in the range of
those made by the SEC, like the SEC, the Program will aim to
provide whistleblowers with adequate protections, including
anti-retaliation measures in circumstances where an individual has
provided information about its current employer to the OSC, or in
circumstances where the individual has reported wrong doing
internally within his or her organization.
The OSC approach to incentivizing whistleblowers to provide
information will be followed closely to see whether it is able to
elicit the quality, timely information it seeks in order to fulfil
its mandate to protect investors from the misconduct of market
Andrew Ceresney, Director of the SEC's Division of
Enforcement noted that company insiders such as the whistleblower
in this case "are uniquely positioned to protect investors and
blow the whistle on a company's wrongdoing by providing key
information to the SEC so [it] can investigate the full extent of
the violations". Ceresney also commented that "[t]he
information and assistance provided by this whistleblower enabled
[SEC] enforcement staff to conserve time and resources and gather
strong evidence supporting [the SEC's] case."
As with the American regulatory environment, the Ontario Program
will be widely observed by other jurisdictions and market
participants, to see if its operation will materially chance the
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