Dejan Jasnic · Co-founder & Compliance Lead, Trusty · 20+ years anti-fraud & compliance · ACFE Swiss Chapter Board
Whistleblowing in the US has long been associated with financial misconduct, securities fraud, and insider trading. For many companies, it has been viewed as a narrow compliance requirement, primarily relevant to listed companies and financial institutions.
In 2026, that view is no longer sufficient.
Whistleblowing in the US is expanding in scope, visibility, and importance. It is increasingly being used to surface risks across cybersecurity, workplace conduct, sanctions exposure, and broader governance failures. At the same time, regulators are relying more heavily on whistleblowers as a primary source of information.
The result is a shift in how whistleblowing functions. It is moving from a legal safeguard to an operational tool for identifying risk.
How whistleblowing in the US works:
At the core of the US whistleblowing framework is a combination of legal protection and financial incentives. The most well-known example is the program established under the Dodd-Frank Wall Street Reform and Consumer Protection Act, which created the SEC Whistleblower Program administered by the U.S. Securities and Exchange Commission. This program allows individuals to report potential violations of securities laws directly to the regulator and, if the information leads to a successful enforcement action, receive a financial award.
Under this framework, whistleblowers may receive between 10% and 30% of monetary sanctions collected in cases where penalties exceed $1 million. In parallel, protections against retaliation are reinforced through provisions in Dodd-Frank and earlier legislation such as the Sarbanes-Oxley Act, which prohibits retaliation against employees who report certain types of misconduct.
This combination of protection and incentive has fundamentally shaped whistleblowing in the US. It has also contributed to a steady increase in reporting activity and enforcement outcomes over time.
What has changed recently
What has changed more recently is not the existence of these frameworks, but how they are being used. Whistleblowing is no longer confined to traditional financial misconduct. It is now increasingly relevant across a wider range of risk areas.
Cybersecurity is a clear example. In recent years, the U.S. Securities and Exchange Commission has brought enforcement actions related to the failure to properly disclose cyber incidents and vulnerabilities. This aligns with broader regulatory developments, including mandatory cybersecurity disclosure rules adopted in 2023, which require public companies to report material incidents in a timely manner. In this context, whistleblowers are becoming an important channel for surfacing failures in internal reporting and incident management.
Workplace conduct is another area where whistleblowing has expanded. Reports related to harassment, discrimination, and ethical misconduct are increasingly being treated not only as HR issues, but as indicators of broader governance and cultural risk. In some cases, these reports can escalate into regulatory or legal exposure if not handled appropriately.
Environmental, social, and governance (ESG) issues are also entering the whistleblowing landscape. Allegations related to environmental harm, supply chain practices, or misleading sustainability claims can now trigger scrutiny from regulators, investors, and the public. In the US, the U.S. Department of Justice has also signaled a growing interest in encouraging voluntary disclosures and internal reporting as part of corporate compliance programs.
Sanctions and third-party risk are another emerging area. As enforcement around sanctions becomes more active, particularly in relation to global geopolitical developments, whistleblowers may play a role in identifying circumvention or indirect exposure through business partners.
Taken together, these developments point to a broader shift. Whistleblowing is becoming a cross-functional mechanism for identifying risk, rather than a narrowly defined compliance channel.
For companies, this creates a practical challenge. If internal reporting systems are limited, unclear, or not trusted, employees may choose to report externally instead. Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, individuals are not required to report internally before approaching regulators. In fact, the availability of financial incentives can actively encourage external reporting where internal channels are perceived as ineffective.
This has important implications. Once a report is made externally, the company loses control over how the issue is handled and communicated. Investigations may be initiated without prior notice, and the opportunity to address the issue internally at an early stage is reduced.
In this environment, regulators are not only looking at whether issues occur, but how companies respond to them. Expectations increasingly include having a confidential and accessible reporting channel, the ability to handle different types of reports, and a documented process for managing and resolving cases.
What this means for SMEs
For SMEs, this shift can appear distant at first glance. Many assume that US whistleblowing frameworks apply primarily to large or listed companies. However, the underlying dynamics extend beyond company size. SMEs are often part of larger supply chains, work with international partners, or operate in sectors where expectations around governance are increasing.
In these contexts, having a basic, structured whistleblowing system is no longer unusual. It is becoming part of how companies demonstrate that they take risk management seriously.
The challenge is not complexity, but implementation. SMEs do not need large compliance teams or sophisticated infrastructure. What they need is a clear and accessible reporting channel, a way to manage incoming reports, and a record of how issues are handled.
This is where structured solutions become relevant. Platforms like Trusty provide secure and confidential channels for reporting, combined with case management workflows that allow organisations to document and track how reports are handled. Increasingly, these systems can also be used to capture a broader range of signals, including cybersecurity vulnerabilities or third-party concerns, reflecting the expanding scope of whistleblowing.
The benefit is not only compliance. It is visibility. Issues can be identified earlier, addressed more effectively, and documented in a way that meets growing expectations from regulators and partners.
In 2026, whistleblowing in the US is no longer just about reporting wrongdoing after the fact. It is becoming part of how organisations detect and manage risk in real time.
Companies that treat whistleblowing as a formality may find themselves reacting to issues too late. Those that treat it as a source of insight are better positioned to respond early and maintain control.
Frequently asked questions
Under Dodd-Frank, individuals who report potential securities law violations may receive between 10 and 30 percent of the monetary sanctions collected where penalties exceed 1 million dollars.
No. Under Dodd-Frank, individuals are not required to report internally before approaching regulators, and the financial incentives can encourage external reporting where internal channels are seen as ineffective.
Cybersecurity disclosure failures, workplace conduct such as harassment and discrimination, ESG claims and supply chain practices, and sanctions and third-party exposure.
Not a large compliance team, but a clear and accessible reporting channel, a way to manage incoming reports and a record of how issues are handled.
Related reading: whistleblower hotline requirements by US state, and why US companies need whistleblower software.
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