Subject: File No. S7-33-10
From: Nicholas J Taldone, Esquire
Affiliation: Principal, Law Offices of Nicholas J. Taldone

December 17, 2010

I am writing in support of the proposed rules that would establish whistleblower protection under Dodd Frank.I am an attorney who practices both in the area of employment law and securities law. I previously was an in-house counsel for a Fortune 100 corporation, and am very familiar with how corporations deal with internal investigations of corporate wrongdoing. The primary objective of corporate investigations is to protect the corporation. In doing so, there is a tendency to minimize the extent of the wrongdoing and to minimize the number of individuals responsible. With these generalizations in mind, the proposed rules are necessary as proposed and should not be changed to require the whistleblower to report the alleged wrongdoing to the corproation for internal investigation. It would be counterproductive for the whistleblower to under all circumstances be forced to report the wrongdoing to the corporation in the first instance because based on my experience, the whistleblower has little protection in most states from retaliation in terms and conditions of employment, including discharge. The corporation's response will be to conduct an immediate investigation, and will narrow the field of likely whistleblowers to two or three individuals because these two or three individuals are the only ones who had the knowldge to put the "wrongdoing" together. Perhaps all three will be subject to retaliation. Or perhaps the whistleblower will be "outed" by the others.In any event, there is little protection for the whistleblower, and therefore little motivation for the whistleblower to come forward.
I also support the compensation structure for the whistleblower under the proposed rules. The recent debacles in the financial services industry that have forced our lengthy recession indicate that wrongdoing by financial instituions can have a major economic impact extending throughout the global economy. Rather than addressing the "too big to fail" issue, Dodd Frank has sought to "chip at the edges" in reform. Thus, the "too big too fail" institutions of 2007-2008 are now bigger than ever. One way to counterbalance the economic power of these institutions is through the proposed whistleblower protection. The fact that valid complaints may uncover serious wrongdoing that could affect the global economy outweighs the danger that some may come forward to file complaints solely because of the potential financial rewards.
The budgetary constraints of the SEC are a serious concern, but should not justify diluting the teeth of Dodd Frank.