In response to a string of highly publicized corporate accounting scandals, the U.S. Congress enacted the Public Company Reform and Investor Protection Act of 2002, commonly known as the Sarbanes-Oxley Act. This Act includes a new provision to protect whistleblowers by prohibiting retaliation against employees of publicly traded companies who report fraudulent activity.
Specifically, publicly traded companies are subject to liability under 18 U.S.C. Section 1514A if they commit retaliatory acts against an employee for reporting or assisting in an investigation of fraud or other securities violations. The act prohibits a broad range of retaliatory activities against the employee, including discharge, demotion, suspension, threats, harassment, or any other form of discrimination.
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Los Angeles Sarbanes-Oxley Act Lawyers
The Sarbanes-Oxley whistleblower provision applies to certain types of publicly traded companies which are registered or required to file reports under federal securities laws. In addition, Sarbanes-Oxley may apply to some subsidiary corporate entities, which do not themselves fall into the covered categories, if the parent corporation is covered.
Sarbanes-Oxley’s whistleblower provision protects employees who report activity they reasonably believe to be illegal, even if a court later determines that the reported behavior did not violate any laws. This protection encourages employees to report suspicious activity, without fear of retaliation if there turns out to be a legitimate explanation.
Victims of retaliation who seek to assert their rights under Sarbanes-Oxley must observe certain procedures. The statute of limitations is particularly important; employees must file a complaint with the Department of Labor within 90 days of the retaliatory act, and this time limit can only be extended under limited circumstances. After receiving a complaint, the Department of Labor will inform the employer of the allegations, conduct an investigation, and issue written findings. Either party may challenge the written findings and seek administrative review.
Contact a California Sarbanes Oxley Act Attorney
If you work for a publicly traded company and have observed activity that you believe is fraudulent, please contact us to arrange a consultation. We can help you understand your rights and decide when and how to report the problem.
Contact the Rubin Law Corporation of Los Angeles and Beverly Hills today by calling us at 866.936.3162 or you can schedule a consultation via email.