December 14, 2010
Something about the SEC essentially paying "snitches" for information makes me uneasy. I understand that providing a reward for disclosing information to the SEC concerning potential violations of securities laws may allow the SEC to better protect investors certainly such enforcement will allow the playing field to be made more level for all participants, which is a positive for uninformed investors. However, it seems like a better solution could be found than offering rewards to whistleblowers. There may be unintended consequences such as employees going behind their employers back without exploring the proper channels, and the SEC may at times be swamped with irrelevant information from individuals simply seeking a reward.