Subject: File No. S7-33-10
From: Sean Rober
Affiliation: Student

December 14, 2010

Regardless of whether the SEC will be restrained by budget in creating an entirely new whistleblower office, an increased emphasis on incentives for reporting securities law violations seems especially relevant at this time. Of all the many financial regulations in Dodd-Frank, the encouragement of proactive reporting by firm employees when wrongdoing is suspected may be one of the most important provisions. Cases like Enron and Bernie Madoff where billions of dollars was lost in intentional deception leave one wondering how many retirement funds and life savings might have been saved had the fraud been detected earlier. If greater had been provided to Enron employees who knew of the fraud, might it have been detected several years before the whistleblower finally came forward? Incentives for private employees to do their civic duty will help avoid the disasters of the past and decrease taxpayers cost if the problems can be nipped in the bud before further investigations/prosecutions/bailouts are sought by the federal government. The more fraud that can be vetted out and reported due to these incentives, the better the free market system can work and thus the healthier the economy can be. In sum, encouraging business to self-regulate and seek federal help when crime is detected will save taxpayer money and federal workforce time compared to a system of attempting to micromanage every aspect of the market.