SEC Fines Company for Severance Agreements that Deter Whistleblowing

A sign for the Securities and Exchange Commission (SEC) is pictured in the foyer of the Fort Worth Regional Office in Fort Worth, Texas June 28, 2012. REUTERS/Mike Stone
A sign for the Securities and Exchange Commission (SEC) is pictured in the foyer of the Fort Worth Regional Office in Fort Worth, Texas June 28, 2012. REUTERS/Mike Stone

U.S. securities regulators filed charges on Tuesday against a California-based company for preventing outgoing employees from reaping the benefits of government whistleblower awards.

The Securities and Exchange Commission said Health Net Inc will pay $340,000 to settle charges that it violated whistleblower rules by requiring employees to sign severance agreements in which they waived their rights to government bounties.

The case comes less than a week after the SEC filed similar charges against Atlanta-based building products maker BlueLinx. Both companies settled with the SEC without admitting or denying the charges.

(Reporting by Sarah N. Lynch; Editing by David Gregorio)

SOURCE: Reuters