Gensler Reveals SEC Received Record Number of Whistleblower Tips in FY 2023

Geoff Schweller

Published On: October 26th, 2023

On October 25, U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler highlighted the importance of whistleblowers during remarks at the 2023 Securities Enforcement Forum. He revealed that in the 2023 Fiscal Year, the SEC received a record number of whistleblower tips.

“The public’s tips, complaints, and referrals (TCRs) are essential to our work as a cop on the beat,” Gensler stated. “We received more than 40,000 TCRs in the previous fiscal year, including more than 18,000 from those critical whistleblowers.”

With each passing fiscal year, the SEC has been setting a new record for whistleblower tips. In the 2022 Fiscal Year, the SEC received a record 12,300 tips. The growth between FY 2022 and 2023 is among the two largest single-year increases in the history of the SEC Whistleblower Program.

“Whistleblowers are accountability’s cornerstone,” says KKC founding partner Stephen M. Kohn. “Chair Gensler’s comments further support the need for Congress to pass the bipartisan SEC Whistleblower Reform Act of 2023. Without the Reform Act whistleblowers will continue to wait for years in order to obtain any compensation, and those facing retaliation often will have no remedy.”

Introduced by Senators Chuck Grassley (R-IA) and Elizabeth Warren (D-MA) on March 15, the SEC Whistleblower Reform Act of 2023 extends whistleblower protections to corporate whistleblowers who report potential securities violations internally but not externally to the SEC. Furthermore, the bill codifies an SEC rule banning restrictive non-disclosure agreements and aims to ensure the prompt payment of whistleblower awards by setting mandatory deadlines for the SEC to issue award determinations. Former SEC Commissioner Allison Herren Lee, currently Of Counsel at KKC, wrote a piece calling for the passage of the bill.

“While growth of the SEC Whistleblower Program is reflected by another record breaking year for tips submitted we should focus on the challenges of managing 18,000 tips. Lots of fraud that gets reported is not investigated and fraudsters still escape accountability,” said KKC founding partner David Colapinto on X (formerly known as Twitter).

“How many good whistleblower tips go unread by the right people or aren’t acted upon? That’s difficult to measure but with so many tips submitted and limited resources to investigate fraud it’s a big challenge,” Colapinto added.