SEC Charges Privately Held Monolith Resources for Using Separation Agreements that Violated Whistleblower Protection Rules
Monolith Resources LLC violated SEC whistleblower protection rules by forcing departing employees to waive monetary award rights from Feb 2020 to Mar 2023, and settled by paying a $225,000 civil penalty and agreeing to a cease‑and‑desist.
The SEC charged Monolith Resources LLC, a privately held energy and technology firm in Lincoln, Nebraska, with violating Securities Exchange Act Rule 21F‑17 by using separation agreements that required departing employees to waive their right to monetary whistleblower awards from February 2020 through early March 2023. Monolith neither admitted nor denied the findings but consented to a cease‑and‑desist order and to pay a $225,000 civil penalty, taking into account its remedial actions such as notifying former employees that the agreements do not limit their award eligibility. The settlement resolves the SEC’s allegations and requires Monolith to stop the prohibited practice.
The Securities and Exchange Commission announced that Monolith Resources LLC, a privately held energy and technology company based in Lincoln, Nebraska, violated whistleblower protection rules by requiring departing employees to waive their right to monetary awards in separation agreements from February 2020 to early March 2023. This conduct breached the Securities Exchange Act of 1934 Rule 21F‑17, which is intended to encourage individuals to report possible securities law violations. Monolith did not admit or deny the SEC’s findings but consented to a cease‑and‑desist order and agreed to pay a $225,000 civil penalty, reflecting its remedial steps. As part of the settlement, the company must notify former employees that the agreements do not limit their ability to receive whistleblower awards. The SEC’s investigation was led by Jeffrey S. Lyons and supervised by senior staff in the Denver Regional Office. The settlement fully resolves the SEC’s charges and bars Monolith from repeating the prohibited practice.
Exhibits & Attached Documents (1)
Extracted insights
- $225K $225,000 $100K–$1M
- agency committing or causing violations of the sec’s whistleblower protection rules
- person jason j. burt
- company monolith resources llc
- agency sec order
- agency Securities and Exchange Commission
- Securities And Exchange Commission announced settled charges against Monolith Resources LLC
- Monolith Resources LLC used separation agreements that required departing employees to waive rights to monetary whistleblower awards
- SEC Order finds Monolith’s separation agreements raised impediments to participation in the SEC’s whistleblower program
- Jason J. Burt said both private and public companies must understand they cannot take actions or use separation agreements that disincentivize employees from communicating with SEC staff about potential violations
- Monolith Resources LLC violated Securities Exchange Act Of 1934 Rule 21F-17
- Monolith Resources LLC consented to cease and desist from committing or causing violations of the SEC’s whistleblower protection rules
- Monolith Resources LLC agreed to pay a civil penalty of $225,000
The Securities and Exchange Commission today announced settled charges against Monolith Resources LLC, a privately held energy and technology company headquartered in Lincoln, Nebraska, for using employee separation agreements that violated the SEC’s whistleblower protection rules. According to the SEC’s order, from February 2020 until early March 2023, Monolith used separation agreements that required certain departing employees to waive their rights to monetary whistleblower awards in connection with filing claims with or participating in investigations by government agencies. The SEC’s order finds that Monolith’s separation agreements raised impediments to participation in the SEC’s whistleblower program by having employees forego important financial incentives that are intended to encourage people to communicate directly with SEC staff about possible securities law violations. “Both private and public companies must understand that they cannot take actions or use separation agreements that in any way disincentivize employees from communicating with SEC staff about potential violations of the federal securities laws,” said Jason J. Burt, Regional Director of the SEC’s Denver Office. “Any attempt to stifle or discourage this type of communication undermines our regulatory oversight and will be dealt with appropriately.” The SEC’s order finds that Monolith violated Securities Exchange Act of 1934 Rule 21F-17. Without admitting or denying the SEC’s findings, Monolith consented to cease and desist from committing or causing violations of the SEC’s whistleblower protection rules. Monolith also agreed to pay a civil penalty of $225,000, which takes into account its remedial actions, including notifying former employees who had signed the improper separation agreements that the agreements do not in any way limit their ability to obtain financial awards in connection with providing information to government agencies. The SEC’s investigation was conducted by Jeffrey S. Lyons and supervised by Ian S. Karpel, Nicholas P. Heinke, and Mr. Burt of the Denver Regional Office.
The Securities and Exchange Commission today announced settled charges against Monolith Resources LLC, a privately held energy and technology company headquartered in Lincoln, Nebraska, for using employee separation agreements that violated the SEC’s whistleblower protection rules. According to the SEC’s order, from February 2020 until early March 2023, Monolith used separation agreements that required certain departing employees to waive their rights to monetary whistleblower awards in connection with filing claims with or participating in investigations by government agencies. The SEC’s order finds that Monolith’s separation agreements raised impediments to participation in the SEC’s whistleblower program by having employees forego important financial incentives that are intended to encourage people to communicate directly with SEC staff about possible securities law violations. “Both private and public companies must understand that they cannot take actions or use separation agreements that in any way disincentivize employees from communicating with SEC staff about potential violations of the federal securities laws,” said Jason J. Burt, Regional Director of the SEC’s Denver Office. “Any attempt to stifle or discourage this type of communication undermines our regulatory oversight and will be dealt with appropriately.” The SEC’s order finds that Monolith violated Securities Exchange Act of 1934 Rule 21F-17. Without admitting or denying the SEC’s findings, Monolith consented to cease and desist from committing or causing violations of the SEC’s whistleblower protection rules. Monolith also agreed to pay a civil penalty of $225,000, which takes into account its remedial actions, including notifying former employees who had signed the improper separation agreements that the agreements do not in any way limit their ability to obtain financial awards in connection with providing information to government agencies. The SEC’s investigation was conducted by Jeffrey S. Lyons and supervised by Ian S. Karpel, Nicholas P. Heinke, and Mr. Burt of the Denver Regional Office.