BlackRock Inc. agreed to pay a $340,000 penalty to settle SEC charges alleging violations of the whistleblower provisions of the Dodd-Frank Act by entering into separation agreements that required employees to waive the ability to obtain whistleblower awards.
The SEC Order found that BlackRock revised its form separation agreement to require a departing employee to waive the recovery of incentives for reporting misconduct in exchange for receiving monetary separation payments from BlackRock. The Order stated that even though the SEC remains "unaware of any instances" in which BlackRock prevented whistleblower communications, BlackRock "directly targeted the SEC's whistleblower program by removing the critically important financial incentives that are intended to encourage persons to communicate directly with the SEC staff about possible securities law violations."
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