SEC Charges D. E. Shaw with Violating Whistleblower Protection Rule

The Securities and Exchange Commission today announced settled charges against New York-based registered investment adviser D. E. Shaw & Co., L.P. for raising impediments to whistleblowing by requiring employees to sign agreements prohibiting the disclosure of confidential corporate information to third parties, without an exception for potential SEC whistleblowers, and by requiring departing employees to sign releases affirming that they had not filed any complaints with any government agency in order for the employees to receive deferred compensation. D. E. Shaw agreed to pay $10 million to settle the SEC’s charges. The SEC’s order finds that, from at least 2011 through 2019, D. E. Shaw required new employees to sign agreements that prohibited them from disclosing confidential information to anyone outside the company unless authorized by D. E.