In terms of a securities case that’s filed with the Securities and Exchange Commission, you’d be filing under their whistleblower office. You have the right to file and you can file anonymously, and the Securities and Exchange Commission has the ability to pursue the underlying case of fraud on your behalf.
If they’re successful, you would then get a reward, unless it is a securities case in which a state has been defrauded—meaning one of the few states that have their own False Claims Acts that also allow for any kind of fraud to be pursued, not just a healthcare False Claims Act. There are now at least 29 states with their own False Claims Acts.
How to File a Securities Whistleblower Case
Unless you’re filing on behalf of the Massachusetts pension plan, for example, the Securities and Exchange Commission is the way you would normally bring a securities fraud case. If a state pension plan has been defrauded, then that case would follow the same pattern as any other False Claims Act case in the sense of filing the case under seal and having the opportunity to have the government investigate it and for the whistleblower to pursue the matter in court as well, as long as that state’s law permitted a general kind of fraud to be the subject of a case. Generally, the Federal Government doesn’t buy securities on a regular basis.
A federal case of healthcare fraud would follow the Federal False Claims Act procedures, while a federal case of securities fraud would likely go to the Securities and Exchange Commission. If there is a case of securities fraud, it is entirely possible that a state might pursue a case of securities fraud under a State False Claims Act. That might even be a better way to go, or at least an additional way to go in pursuing the same fraud; there is overlap here.
Ultimately, it depends on the facts of the case and it depends on who got defrauded to determine the best way to go. The procedures involved in filing the case with the Securities and Exchange Commission are different procedures than you would follow in filing a traditional False Claims Act case.