One of the more powerful rules enacted through the Dodd-Frank Act after the last financial crisis enables insiders of companies to step forward to identify possible fraud. In 2016, three Merrill Lynch (Bank of America) employees had the courage (and financial incentive) to blow the whistle on complex transactions that artificially reduced the amount of customer funds that had to be set aside in reserve accounts. This illicit activity essentially allowed Merrill Lynch to finance its own trading activities using customer funds.
The SEC won a $415 million settlement with Bank of America Merrill Lynch and just yesterday announced that the three informants will split an $83 million payout - the biggest yet under the program.
Good on them for coming forward! We hope this law helps put a dent in the rampant criminal activity in the financial world.
