Financial Anti-Fraud Act Advances For Final Approval

Financial Anti-Fraud Act Advances For Final Approval - 5/19/2009

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Financial Anti-Fraud Act Advances For Final Approval
Jessica Dye

Securities Law 360. May 19, 2009
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EXCERPT: The House of Representatives has signed off on the Fraud Enforcement and Recovery Act, which — with President Obama's final signature — will equip federal enforcement agencies with broad legal and budgetary tools, including increased whistleblower protections, to combat financial fraud across a range of industries and markets. House members approved FERA on Monday with a vote of 338 to 52, after the legislation co-sponsored by Sens. Patrick Leahy, D-Vt., Chuck Grassley, R-Iowa, and Ted Kaufman, D-Del., advanced from the Senate on Thursday with senators' overwhelming 92-4 affirmative vote. “Those who illegally lined their pockets and left investors — and millions of Americans — with the devastating consequences, should pay the price,” Kaufman said in a statement Monday. “This bill will help get that job done, with real benefits for all those who participate in the financial markets and want them to be free and fair.” Leahy noted that the bill has already received the administration's initial endorsement. The bill's sponsors urged Obama to act quickly on signing FERA into law. The bill's primary goal is to strengthen federal agencies' abilities to combat fraud on all levels, from provisions to strengthen and expand whistleblower protections to increased staffing and budget allowances for taking enforcement action. Congressional members negotiated the authorization of $245 million a year over the next two years for the U.S. Department of Justice, FBI, United States Attorney's Office, U.S. Securities and Exchange Commission and other enforcement agencies to add more than 300 additional agents, more than 200 new prosecutors and 200 additional forensic analysts and support staff for white collar crime enforcement. FERA also aims to strengthen the False Claims Act, with what Grassley called “the most significant amendments to the FCA since 1986, which will ensure that court decisions that limit the FCA are overturned and congressional intent is restored.”

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