SEC Awards Whistleblowers for Reporting Corporate Fraud
The Securities and Exchange Commission announced on July 25, 2017, that it issued an award of nearly $2.5 million to an employee of a government agency. The whistleblower tipped off the SEC to the misconduct of a company which launched the SEC’s investigation and “provided timely ongoing assistance along with critical documents and testimony that accelerated the pace of our enforcement action.”
”Whistleblowers can provide a wealth of information and ongoing assistance that helps our agency bring enforcement actions quicker and more efficiently,” said Jane Norberg, Chief of the SEC’s Office of the Whistleblower. ”This whistleblower not only helped us open the case, but also provided timely ongoing assistance along with critical documents and testimony that accelerated the pace of our enforcement action.”
Two days later the SEC announced an award of $1.7 million to a company insider who gave it critical information that helped stop a fraud that “would have otherwise been difficult to detect.” Because of the whistleblower’s assistance, “millions of dollars were returned to harmed investors.”
”When whistleblowers tip the SEC, it not only can bring wrongdoers to justice but also relief to investors,” said Norberg. ”This whistleblower’s valuable information enabled us to stop further investor harm and ultimately return money to victims.”
Approximately $158 million has now been awarded to 46 whistleblowers who voluntarily provided the SEC with original and useful information that led to a successful enforcement action.
The SEC does not disclose the identity of whistleblowers nor release information that might directly or indirectly reveal a whistleblower’s identity.
Whistleblowers who voluntarily provide the SEC with unique and useful information that leads to a successful enforcement action may be eligible for an award. Whistleblower awards can range from 10 percent to 30 percent of the money collected when the monetary sanctions ordered exceed $1 million. All payments are made from an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators. No money has been taken or withheld from harmed investors to pay whistleblower awards.
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