HomeSEC Awards Whistleblower $5 Million in First Award of 2023

SEC Awards Whistleblower $5 Million in First Award of 2023

On January 6, the U.S. Securities and Exchange Commission (SEC) issued a $5 million whistleblower award to an individual who voluntarily provided original information that contributed to the success of an enforcement action. It is the first award granted by the agency in 2023.

Through the SEC Whistleblower Program, qualified whistleblowers, individuals who voluntarily report original information that leads to a successful enforcement action, are entitled to monetary awards of 10-30% of the sanctions collected in the enforcement action. The SEC also provides anti-retaliation protections to whistleblowers, including confidentiality.

According to the award order, the whistleblower “provided original information based on independent knowledge and analysis and not already known to the Commission from any other source.” The SEC determined that the whistleblower “voluntarily” provided the information despite having previously been subpoenaed by the agency because “that subpoena and the underlying investigation did not ‘relate[] to the subject matter of [Claimant’s] submission,’” the award order states.

In determining the exact percentage to award a qualified whistleblower, the SEC weighs a number of factors, including the significance of the information, the degree of assistance provided by the whistleblower, culpability, and the timeliness of the disclosure.

According to the award order, the whistleblower’s information “was important in that it caused staff to promptly open its investigation.” The SEC further notes that the whistleblower “also provided some additional assistance in the course of an in-person meeting and two phone calls.”

However, in contrast, the SEC negatively assessed the fact that the whistleblower unreasonably delayed in making their disclosure. “Regardless of Claimant’s motivation for submitting the tip when he/she did, we find that Claimant substantially and unreasonably delayed in reporting Claimant’s information by waiting approximately four years to provide information to the Commission and doing so only after Claimant received a subpoena from the SEC related to Claimant’s own misconduct,” the award order states.

In the 2022 Fiscal Year, the SEC issued 103 whistleblower awards totaling $229 million. Overall, the whistleblower program has awarded more than $1.3 billion to more than 300 whistleblowers.

Individuals considering blowing the whistle to the SEC should first consult an experienced whistleblower attorney to ensure they are fully protected and qualify for the largest possible award.

Share This Story, Choose Your Platform!

Latest News & Insights

  • March 24, 2023

    On March 23, leading whistleblower attorney Stephen M. Kohn of Kohn, Kohn & Colapinto was a guest on the Federal Drive with Tom Temin. Kohn spoke about recent developments in whistleblowing including the December passage of the Anti-Money Laundering (AML) Whistleblower Improvement Act and the troubling False Claims Act statistics ...

  • March 16, 2023

    On March 15, a bipartisan group of senators introduced the SEC Whistleblower Reform Act of 2023. The bill strengthens the U.S. Securities and Exchange Commission’s (SEC) highly successful whistleblower award program by addressing issues in the Dodd-Frank Act. “This is an important bill that needs to be quickly passed,” said leading whistleblower attorney Stephen M. ...

  • March 15, 2023

    This article originally appeared in JD Supra. From oustee to advocate, former FBI agent Jane Turner continues to uplift whistleblowers while sharing her personal story exposing widespread misconduct and cover-ups within the Federal Bureau of Investigation (FBI). Standing outside a Minneapolis courtroom 16 years ago, jurors hugged Turner with tears in their ...

  • March 15, 2023

    WhistleblowersUK is set to host their 1st annual Whistleblowing Awareness Week from Monday, March 20 through Friday, March 24. The event occurs in conjunction with the All Party Parliamentary Group (APPG) for Whistleblowing. Designed to bring together leading voices in the whistleblower sphere to advocate for more robust laws in the UK and beyond, ...

Subscribe for News & Resources

Receive exclusive updates and news from our firm.