Whistleblowers Who Take Company Documents May Risk Criminal Prosecution

August 17, 2015  |  The Insider: White Collar Defense and Securities Enforcement

Federal law now protects whistleblowers in many instances from retaliation and encourages them, through financial incentives, to bring qui tam lawsuits and report possible wrongdoing to the SEC and IRS. In this fashion, the law turns company employees into potential confidential informants. As informants, employees have a powerful incentive to provide federal authorities secretly with business-related information (including documents) that a company would ordinarily consider confidential and strictly for internal use. The regime of whistleblower law expects and even promotes such conduct – though at least one recent state case demonstrates that taking an employer’s confidential information, when it is done for private purposes, still violates the law. [...]

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