SEC Whistleblower Reform Act of 2023

To amend the Securities Exchange Act of 1934 to further enhance anti-retaliation protections for whistleblowers, and for other purposes. 1. Short title This Act may be cited as the SEC Whistleblower Reform Act of 2023 2. Whistleblower protections for internal disclosures (a) In general Section 21F of the Securities Exchange Act of 1934 ( 15 U.S.C. 78u–6 (1) in subsection (a)(6)— (A) by striking The term (A) In general The term ; and (B) by adding at the end the following: (B) Special rule Solely for the purposes of subsection (h)(1), the term whistleblower ; and (2) in subsection (h)(1)— (A) in subparagraph (A)— (i) in the matter preceding clause (i), by inserting or post-employment of employment (ii) in clause (i), by inserting , in writing or orally if the oral report is documented, to the Commission (iii) in clause (ii), by striking or (iv) in clause (iii), by striking the period at the end and inserting ; or (v) by adding at the end the following: (iv) in providing information regarding any conduct that the whistleblower reasonably believes constitutes a violation of any law, rule, or regulation subject to the jurisdiction of the Commission to— (I) a person with supervisory authority over the whistleblower at the employer of the whistleblower, if that employer is an entity registered with, or required to be registered with, or otherwise subject to the jurisdiction of, the Commission, the Public Company Accounting Oversight Board, a self-regulatory organization, or a State securities commission or office performing like functions; or (II) another individual working for the employer described in subclause (I) who the whistleblower reasonably believes has the authority to— (aa) investigate, discover, or terminate the misconduct; or (bb) take any other action to address the misconduct. ; and (B) in subparagraph (B), by adding at the end the following: (iv) Jury trial A person against which an action is brought under this subsection shall be entitled to a jury trial. . (b) Applicability The amendments made by subsection (a) shall apply to any claim involving a violation of section 21F(h)(1) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78u–6(h)(1) (1) pending in any appropriate judicial or administrative forum, as of the date of enactment of this Act; or (2) filed after the date of enactment of this Act. 3. Prompt payment of awards Section 21F(b) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78u–6(b) (3) Timely processing of claims (A) Initial disposition (i) In general Except as provided in subparagraph (B), the Commission shall make an initial disposition with respect to a claim submitted by a whistleblower for an award under this section (referred to in this paragraph as an award claim (I) the date that is 1 year after the deadline established by the Commission, by rule, for the whistleblower to file the award claim; or (II) the date that is 1 year after the final resolution of all litigation, including any appeals, concerning the covered action or related action. (ii) Multiple actions If an award claim involves 1 or more related actions, the requirement under clause (i) shall apply with respect to the latest deadline with respect to the actions. (B) Exceptions (i) Initial extension If the Director of the Division of Enforcement of the Commission (referred to in this paragraph as the Director Chairman (ii) Additional extensions If, after providing an extension under clause (i), the Director, or the designee of the Director, determines that good cause exists such that the Commission cannot reasonably satisfy the requirement under subparagraph (A), the Director or the designee of the Director, may extend the deadline described in clause (i) as needed for 1 or more additional successive 180-day periods only after providing notice to and receiving approval from the Commission. (iii) Notice to whistleblower required If the Director, or the designee of the Director, exercises authority under clause (i) or (ii), the Director or the designee, as applicable, shall submit to the whistleblower who filed the award claim that is subject to that action by the Director or the designee a written notification of that action. (C) Applicability This paragraph shall apply only to an award claim that the Director of the designee of the Director determines is timely submitted under a deadline established by the Commission after the date of enactment of this paragraph. . 4. Nonenforceability of certain provisions (a) In general Section 21F of the Securities Exchange Act of 1934 ( 15 U.S.C. 78u–6 (k) Nonenforceability of certain provisions waiving rights and remedies or requiring arbitration (1) Waiver of rights and remedies The rights and remedies provided in this section may not be waived by any agreement, policy form, or condition of employment, including by a predispute arbitration agreement. (2) Predispute arbitration agreement No predispute arbitration agreement shall be valid or enforceable if the agreement requires the arbitration of a dispute arising under this section. . (b) Applicability Subsection (k) of section 21F of the Securities Exchange Act of 1934 ( 15 U.S.C. 78u–6 5. Rulemaking authority The Securities and Exchange Commission may issue any rules that are necessary or appropriate to carry out this Act consistent with the purposes of section 21F of the Securities Exchange Act of 1934 ( 15 U.S.C. 78u–6

Summary: SEC Whistleblower Reform Act of 2023 This bill expands and revises whistleblower protections applicable to individuals who provide information to the Securities and Exchange Commission (SEC) relating to a violation of securities laws. Under current law, an employer is prohibited from retaliating against these whistleblowers. Under the bill, this prohibition is expanded to include (1) individuals who provide information regarding potential violations to supervisors or other employees in positions of authority; and (2) information relating to violations subject to the jurisdiction of the Public Company Accounting Oversight Board, the Municipal Securities Rulemaking Board, or a self-regulatory organization. Additionally, the bill establishes the right to a jury trial for a person accused of violating whistleblower protection laws. The bill also requires the SEC to make an initial disposition of a whistleblower award claim within the later of (1) one year of the deadline to submit such a claim, or (2) one year after the final resolution of any litigation in the matter. Finally, the bill deems as unenforceable a predispute arbitration agreement regarding a whistleblower action.