News uSA
uK Whistleblowers Responsible for One in Four Overseas Tip-offs to uS
Whistleblowers from the UK were responsible for almost one in four (23 per cent) overseas tip-offs to the US Securities and Exchange Commission (‘SEC’) in the last US fiscal year, according to analysis from Kroll Advisory Solutions, the global investigations firm.
The Securities and Exchange Commission (SEC) made its first payment to a whistleblower under the Dodd-Frank Act in August this year, releasing around $50,000 to an individual who helped an investigation that resulted in more than $1 million in sanctions. Kroll says that payouts such as these will encourage more whistleblowers to come forward to the US regulator in search of bounties, as the rewards on offer have no jurisdictional limits as long as the case has a negative impact on US financial markets.
Kroll’s analysis of the SEC’s annual report on its whistleblower program1 reveals that of 3,001 tip-offs received in total in the past year, 324 came from outside the US. Whistleblowers based in the UK were responsible for 74 of these, more than any other country and substantially more than Canada, which is in second place with 46 tip-offs, 14
u.S.Trade Deficit Widened Slightly in October
The American Bankers Association has reported that the U.S. trade deficit widened by $1.9 billion in October, reaching $42.2 billion. The trade deficit has tracked in a narrow range, from $40 to $43 billion, since June. Both exports and imports fell in October, with the decline in exports outpacing the fall in
$ Billions Oct Trade Deficit -42.2 Mo % Change 5% Exports Imports 12 180.5
imports. It is not surprising that both imports and exports fell in October, as Hurricane Sandy shut down many ports in the Northeast.
Exports fell 3.6% in October, reaching $180.5 billion, their lowest level since February. Imports fell in February as
well, but by a more modest 2.1%, reaching $222.8 billion.
The real good’s deficit, which has a direct impact on GDP, shrank slightly in October to $46.2 billion. The European crisis has widened the U.S trade gap, as Europeans import fewer goods due to slowing economic activity.
Sept Aug Jul Jun May -40.3 -42.6 -5% 2% 187.3 181.7 222.8 227.6 224.3
www.finance-monthly.com -41.6 -40.8 -46.9 2% -13% -5% 183.5 185.7 183.3 225.1 226.6 230.2
u.S. Federal Reserve to keep interest rates low until employment improves
In the latest move to battle against unemployment, the U.S. Federal Reserve has outlined plans to keep interest rates low – almost zero – until the number of U.S. residents out of work falls below 6.5%.
Interest rates have been kept low for the last few years, but an announcement that looks at rates in the future is a surprise for many, as the Federal Reserve had originally said that the rates would remain this low only until 2015. It has now committed itself to keeping rates low as long as unemployment rates stay at 6.5% or above, projected inflation is no more than half a percentage above the committee's 2% longer-run
goal, and inflation expectations for the long term stay ‘well anchored’, according to the BBC.
This move is just one of several designed to boost the U.S. economy, another of which is the continuation of the purchase of $85bn (£53bn) of government bonds and mortgage-backed securities each month.
A statement from the Federal Reserve said: "The committee remains concerned that, without sufficient policy accommodation, economic growth might not be strong enough to generate sustained improvement in labour market conditions."
per cent of all those from outside the US.
Whistleblowers from India were responsible for 33 tip-offs (10 per cent), ahead of China with 27 (8 per cent) and Australia with 21 (6 per cent).
Benedict Hamilton, a Managing Director at Kroll, said: “The bounties offered to
whistleblowers by the SEC are likely to have huge repercussions for companies, particularly international ones, as they mean whistleblowers based anywhere in the world are more likely to go to the regulator rather than their company in the hope of being awarded a large payout.
“At the moment UK regulators
don’t offer similar rewards but the Financial Services Authority has been asked to con- sider the approach by the Parlia- mentary commission on banking standards. We have already seen a sharp rise in whistleblowing tip-offs to the regulator in the last few years and the offer of rewards would almost certainly accelerate this trend.
“This reinforces the need for companies to have robust whistleblower procedures in place to find out about any malpractice being carried out by their employees as early as possible and react quickly to limit financial and reputational damage,
and where
appropriate, recover or avoid losses.”
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