TIPPING TIPSTERS
Whistleblowers in for pay day
TORONTO The Ontario Securities Commission will officially launch a rewards-backed whistleblower program July 14, and has named longtime regulator Kelly Gorman as the first chief of the Office of the Whistleblower.
“The OSC’s Office of the Whistleblower will be the first paid whistleblower program by a securities regulator in Canada,” said Maureen Jensen, chair and chief executive of the OSC.
“Kelly’s leadership expertise and oversight of several high-profile enforcement initiatives, as well as her accounting background, make her uniquely suited to lead this investigative multi-disciplinary team.”
The program will pay compensation of up to $5 million to whistleblowers who come forward with tips that lead to successful enforcement action.
The OSC, Canada’s biggest capital markets regulator, says the program is expected to increase the effectiveness its enforcement efforts by providing access to high quality information about matters such as insider trading, accounting and disclosure violations, and misconduct by those registered with the commission.
The program will provide important protection for whistleblowers, including confidentiality and antiretaliation provisions, which are expected to be in place by the time of launch.
Gorman, who some observers viewed as a strong candidate to cover the vacant position of director of the OSC’s enforcement branch, joined the regulator in 2002.
She was most recently deputy director of enforcement, where she oversaw the development of the whistleblower program.
The OSC first considered introducing a paid whistleblower program in 2010, following on the success of an incentive-backed program introduced by the U.S. Securities and Exchange Commission in the aftermath of the financial crisis of 2008.
The idea was resurrected in Canada a few years later, and introduced last October after a series of consultations.
Potential rewards of up to $1.5 million were boosted to $5 million, provided the OSC is able to successfully prosecute wrongdoers and collect significant sanctions.