Following the Financial Crisis of 2008, trust in the financial industry was at an all-time low as the American taxpayer was forced to bailout the very same institutions responsible for their suffering. In response, Congress passed Dodd-Frank in 2010 to ensure another crisis like 2008 never happen again. Section 78u-6 of the Act provides incentives and protections for whistleblowers who report violations of securities laws. In recent years there has been a divide among circuit courts over the question of whether employees who report violations internally to their bosses—and not directly to the SEC—are protected by the Act. Currently, the Second, Fifth, and Ninth Circuits, have all adopted a different answer to this question. In analyzing this issue, courts have so far agreed there is only one definition of whistleblowers according to Dodd-Frank: those individuals who report directly to the Commission. The circuit split, however, is focused on whether, despite the single definition of “whistleblower” provided for by Dodd-Frank, its anti-retaliation provision nonetheless protects individuals who report internally and not directly to the SEC. This Note proposes that under a proper reading of the Act, Congress has granted the SEC broad authority to determine who is a whistleblower and has not narrowly defined a whistleblower to mean only those who report directly to the Commission.
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