What is a Financial Fraud?
Financial and securities fraud directly harms investors and companies in the public and private sectors by manipulating stock prices. Today it is estimated that malicious schemes cost the markets between $10‐40 billion annually. Those who illegally manipulate buy and sell prices affect all the 200 million individuals who trusted their savings in this type of investment, and directly or indirectly rely on them through their pension funds and retirement accounts.
These mischievous scams reached a peak in 2008 when the subprime mortgage crisis sent the global market into recession, taking a heavy toll on U.S. economy. Americans lost much in term of monetary and human resources as millions of dollars and jobs got lost in a very short period of time. In response to this utterly devastating market crash, in 2010 the Congress passed the Dodd‐Frank Wall Street Reform and Consumer Protection Act. The Dodd‐Frank Act (DFA) introduced comprehensive regulatory changes and consumer protection tools to the U.S. financial system. One of the Act’s primary objectives was to detect potential fraudulent behaviors by incentivizing individuals to report illegal activity through whistleblowing. The Act created the SEC Whistleblower Office which granted protection, full anonymity, and large monetary rewards to all relators that help the Government bring these criminals to justice.