Want to blow the whistle? Don't try calling the SEC

Commission wants complaints lodged via e-mail, fax or online — but not by phone; what would McGruff think?

May 20, 2011 @ 3:56 pm

By Dan Jamieson

When financial investigator Edward "Ted" Siedle recently tried to call the Securities and Exchange Commission with a tip, he discovered the SEC's whistle-blower office had no phone number.

It turns out the agency will only accept written whistle-blower complaints via email or fax.

Mr. Siedle, a former SEC lawyer and founder of Benchmark Financial Services Inc., which conducts forensic investigations of money managers for pension funds, said he wanted to report what he thought was a fraudulent hedge fund encountered by a client.

"I wanted to discuss with someone what to me was an obvious fraud," he told InvestmentNews.

But it was a no go.

Miffed, Mr. Siedle then wrote on his Forbes.com blog . about the runaround he got in trying to reach the head of the SEC's new whistle-blower office, Sean McKessy. The column got some action.

This week, via an e-mail message to Mr. Siedle, Mr. McKessy said that since his arrival in February, "we have been considering a dedicated phone number that whistle-blowers can call if they have questions, and now that we have staffed our office we have posted that number on our whistle-blower website.”

The whistle-blower provisions in the Dodd-Frank financial reform law, which offer bounties for successful tips, require that whistle-blowers submit their information in writing in order to be eligible for a financial reward, Mr. McKessy said in his message.

"That's why we have created a dedicated website to facilitate that process. In addition, information received online is easier to track, trace, triage and incorporate into our investigative databases," he wrote.

The SEC also has a separate complaint-reporting portal, where investors fill out an online questionnaire. But again, no phone number is offered.

The SEC's office of Investor Education and Advocacy takes calls from investors who have complaints.

Mr. Siedle said he wasn't looking for a whistle-blower reward. He just wanted to speak with someone.

In fact, he worries that the SEC's new Dodd-Frank-inspired whistle-blower rules, to be voted on by the agency next week, will bog down what should be the most efficient way of uncovering and prosecuting wrongdoing.

As Mr. Siedle said in an updated blog post, "the SEC still doesn't get it that if it's really serious about attracting whistle-blowers, it can't expect every one of them to voluntarily leave a trail" of e-mail messages.

As for the SEC whistle-blower office number, it's (202) 551-4790.

But you still can't report a crime by calling.

The new number, according to the SEC's web site, is in case "you have any questions about the whistle-blower program or need assistance submitting your information in writing."

Meanwhile, Mr. Siedle said Mr. McKessy still hasn't returned his call.

Spokesmen at the SEC declined to comment.


What do you think?

View comments

Recommended for you

Featured video


Top questions surrounding future of DOL fiduciary rule

Reporter Greg Iacurci and managing editor Christina Nelson discuss the biggest uncertainties springing from the Fifth Circuit Court of Appeals' decision to vacate the regulation.

Latest news & opinion

Social Security benefits losing buying power

Low inflation combined with rising Medicare costs threaten the adequacy of seniors' income.

Finra looks to streamline broker-dealer exams

CEO Robert Cook says three examination teams may be consolidated.

The 401(k) robo-revolution is here

Could human advisers be displaced as digital-advice firms use technology to deliver services to plan sponsors and participants?

SEC forging ahead on fiduciary rule despite DOL rule decision in 5th Circuit

Chairman Jay Clayton says 'the sooner the better' when asked when an SEC fiduciary rule will be ready.

What the next market downturn means for small RIAs

Firms that have enjoyed AUM growth because of the runup in stocks may find it hard to adjust to declining revenues if the market suffers a major correction.


Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print