The Australian Securities & Investments Commission (ASIC) issued guidance on Tuesday, outlining how it will protect whistleblowers and handle their reports.
ASIC defines a whistleblower as a person — usually an employee, member or contractor of a company — who reports misconduct, dishonest or illegal activity that has occurred within the company.
In making the disclosure, the whistleblower should have reasonable grounds for suspecting the company or a corporate officer has breached the Corporations Act or the Australian Securities and Investments Commission Act.
A whistleblower must make his or her disclosure to either the employing company’s auditor or a member of the audit team; a director, secretary or senior manager of the company; a person authorized by the company to receive whistleblower disclosures; or ASIC directly.
If the reporting party falls within the statutory definition of whistleblower, he or she is entitled to certain immunities and protections.
The Corporations Act makes it unlawful to prosecute a whistleblower for making a protected disclosure of information and the information. And the identity of the whistleblower must be kept confidential, unless that disclosure is specifically authorized by law.
Whistleblowers are also protected against civil or criminal litigation (including a breach of contract) for disclosing the protected information. They may use this protection as a defense as well.
Further, when a whistleblower’s employment is terminated due to making a protected disclosure, the whistleblower can ask the court to be reinstated into his or her original position or a comparable one.
Whistleblowers are also protected from “victimization,” meaning another party cannot use their status as whistleblowers or their disclosures as a means to harm them.
ASIC’s new guidance on whistleblowers can be found here.
Julie DiMauro is the executive editor of FCPA Blog and can be reached here.