SEC Rewards Whistleblower $2 Million for “Extraordinary” Efforts in Investigation

Today, the Securities and Exchange Commission (SEC) announced a whistleblower award of approximately $2 million given to an individual who provided “extraordinary” assistance to an investigation despite facing retaliation and hardships as a result of their whistleblowing.

According to a press release from the SEC, the whistleblowers’ heroic efforts included overcoming “certain obstacles” and “threats” to present information to the SEC that “would have been difficult for the agency to obtain absent the tip.”

The award order from the SEC determined that:

Claimant provided significant new information during the course of an ongoing investigation that would have been difficult for the staff to obtain in the absence of the Claimant’s tip;

Claimant expeditiously reported the information to the Commission despite certain obstacles to reporting and provided valuable assistance to the investigative staff;

Claimant assisted with the Commission’s investigation despite implied threats made to Claimant;

Claimant suffered hardships as a result of Claimant’s whistleblowing;

And the law-enforcement interests here are high.

“The whistleblower’s actions in this matter were extraordinary,” said Jane Norberg, Chief of the SEC’s Office of the Whistleblower. “The whistleblower expeditiously reported the information to the Commission and provided valuable assistance despite implied threats from the wrongdoers.”

Since issuing its first whistleblower award in 2012, the SEC Office of the Whistleblower has awarded $398 million to 78 individuals. SEC rewards can range between 10 and 30 percent of the money collected when the monetary sanctions exceed $1 million.

According to the whistleblower provisions of the Dodd Frank Act, the SEC must protect the identity of any whistleblower who wishes to remain anonymous.

“The SEC understands the central role qui tam plays in incentivizing whistleblowers to step forward and hold fraudsters accountable,” said Michael D. Kohn, a founding partner of Kohn, Kohn and Colapinto. “The whistleblower awards are paid directly from the fines and sanctions obtained from the fraudsters. The taxpayers pay nothing. Everyone benefits, except for the criminals whom the whistleblowers turned in.”

Whistleblowers who want to file for anonymous SEC rewards should first hire an experienced whistleblower attorney. To apply for an award, whistleblowers must then fill out a Form TCR, and submit it to their whistleblower attorney.

Read the SEC press release: SEC Awards Approximately $2 Million to Whistleblower

Read the SEC order