Corporate Whistleblowers Could Fetch Rewards of Over $1.5 Mln From Canada

Canadian whistleblowers could receive awards of over $1.5 million according to a formal policy unveiled by the Ontario Securities Commission to encourage those in the know to ferret out corporate wrongdoing.

Initially, the regulator capped the award at $1.5 million. However Tom Atkinson, the OSC’s director of enforcement, said Monday that it could be larger in some cases.

He said the rules will be known after the formal policy is unveiled.

But he hinted that qualifying for the higher amount would likely depend on the collection of sanctions or settlement payment, rather than simply the assessment of money due, Financial Post reported.

The initial proposal stated that a whistleblower could receive up to 15 percent of monetary sanctions or settlement payments of over $1 million, but capped at $1.5 million.

During subsequent discussions, some market participants insisted that awards for whistleblowers should not be capped and should be paid even if sanctions or settlement payments do not exceed $1 million.

In their turn, some companies and market participants argued that the initiative would undermine companies’ internal reporting. They also argued that employees could delay reporting or encourage more wrongdoing to be awarded with higher financial awards.

The OSC whistleblower program is going to be the first of its kind introduced a Canadian regulator.

The formal policy will be unveiled on Wednesday. It is expected to be open for public discussion, with the OSC planning to launch it by next spring.