The Securities and Exchange Commission has announced that SandRidge Energy, an oil and gas company, must pay $1.4 million to settle charges that it retaliated against a whistleblower and used illegal language in separation agreements. It is the first time a company was penalized for actions against a whistleblower since the passage of provisions of the Dodd-Frank Act took effect in August 2011. SandRidge also was charged with using illegally restrictive language in separation agreements that impeded outgoing employees from communicating with the SEC. It was the second company in two days to settle with the commission over excessively restrictive separation agreements.
The SEC found that the whistleblower had expressed concerns internally about how the company was calculating its reserves. The employee was offered a promotion but turned it down, according to the SEC.
Months later, senior management concluded that the employee was disruptive and could be replaced by someone “who could do the work without creating all the internal strife,” the commission said in a press release.
Jeffrey Newman represents whistleblowers nation wide.