Former Assistant Director Sues SEC Over Illegal Changes to its Successful Whistleblower Program

Lawsuit by Leading Wall Street Whistleblower Attorney Jordan A. Thomas Says New SEC Rulemaking Violates the Law, Breaks Faith with Current SEC Whistleblowers and Undermines the Program’s Future

WASHINGTON, Jan. 13, 2021 (GLOBE NEWSWIRE) -- In the first non-employment lawsuit ever filed against the U.S. Securities and Exchange Commission (“SEC”) by a past employee, Jordan A. Thomas today filed a lawsuit against the Commission in the United States District Court for the District of Columbia. The suit seeks to vacate illegal rule changes that undermine the integrity and effectiveness of the SEC Whistleblower Program—a program that he had a leadership role in developing.

On September 23, 2020, in a 3-2 vote, the Commission approved new rules for its whistleblower program. A broad coalition of SEC Commissioners and anticorruption organizations, along with a bipartisan group of Congressmen, including Senators Warren and Grassley, publicly opposed the proposed rule changes on legal and policy grounds. Thomas, now a partner and Chair of the Whistleblower Representation Practice at the law firm of Labaton Sucharow, seeks to reverse this controversial rulemaking.

“Over the last decade, the SEC has made few missteps with its successful whistleblower program, but this was a major step backwards,” said Thomas. “In a rare legal trifecta, the new whistleblower rules simultaneously violate the law, break faith with current SEC whistleblowers and discourage future potential whistleblowers—especially sophisticated, senior and highly-compensated ones. Christmas came early for Wall Street.”

Thomas said, “I love the SEC and do not lightly bring this lawsuit, but I feel compelled to do so. In reliance on the original whistleblower program rules, I have courageous clients who put their careers and lives on the line to assist the SEC—including wearing FBI wires and smuggling key documents out of China. Now, in the middle of the proverbial football game, the SEC has boldly claimed the authority to move the goal posts on literally hundreds of SEC whistleblowers.”

In 2011, Thomas established the nation’s first whistleblower practice exclusively focused on violations of the federal securities laws. Both pioneer and recognized leader in the field, he has been profiled in the New York Times and on NPR. His clients have secured precedent-setting whistleblower awards and have launched many of the SEC’s most high-profile cases.

To date, his clients have helped the SEC to secure over $1 billion in monetary sanctions and have won the largest single-case SEC whistleblower award in history, more than $83 million. In addition to significant monetary recoveries, among his many landmark cases, he successfully represented the first officer of a public company to win an SEC whistleblower award, the first SEC whistleblower to receive criminal immunity, and the first SEC whistleblower to receive a whistleblower award because his company retaliated against him.

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