Sprint Case May Lead To More Tax FCAs: Whistleblower Rep

July 24, 2013

Jordan A. Thomas examines the importance of whistleblowers on Wall Street

"The New York Attorney General's Office has been aggressive in developing cases in the false claims arena," said Thomas, a former SEC director who helped craft the federal agency's whistleblower program. "Law enforcement authorities are practical. They focus on what works. If New York state starts racking up results, Washington and other states would likely consider similar legislation."

"There is a culture of silence on Wall Street," Thomas said. "Too many financial service professionals have remained silent as their colleagues and competitors engaged in misconduct.

But, Thomas said, the survey also suggests that the SEC and other cops who patrol Wall Street have taken steps toward reviving their credentials.

"In recent years, it has become popular to criticize the SEC and other financial regulators, and this has taken a heavy toll on these financial watchdogs' reputations. Their every move has been scrutinized and they've been unfairly characterized as Keystone cops," he said. "Our survey found that a large and growing percentage of financial services professionals believe that the financial watchdogs are now effective in policing the marketplace."

With doubts persisting among financial services pros about their companies, and with the SEC and other watchdogs performing better in the eyes of the public, according to Thomas, the underlying conditions could be right for a a surge in whistleblower cases across jurisdictions.

"The SEC and other financial watchdogs can expect a substantial increase in whistleblower tips and assistance," he said. "In fact, in the coming years, I predict that the SEC's most significant cases will be the result of whistleblowers and past enforcement records are likely to be broken."