The Securities and Exchange Commission’s (SEC) whistleblower program has shown signs of a marginal increase in total payouts for Fiscal Year 2026 compared to 2025. However, a closer look reveals that the average monetary amount of whistleblower awards paid has reached a historic low.
Following a steep decline in FY 2025, when total payouts dropped to just over $60 million, the SEC has awarded more than $88 million to 25 individual whistleblowers thus far in FY 2026, with two additional orders omitting award amounts. However, despite this modest increase in total award amounts, the program continues to approve smaller awards than in previous years.
The $88 million figure for FY 2026 masks a disparity in how awards are being distributed. An analysis of the individual payouts reveals that nearly 90% of this total amount went to just three individuals, who received awards of $50 million, $20 million, and $7 million. In total, 14 individual whistleblowers received awards of less than $500,000 in FY 2026, while payouts exceeding $1 million were awarded to only six individuals.
This downward trend is clear when comparing the program’s performance from just years prior:
- FY 2023: $600 million awarded to 68 whistleblowers (average $8.82 million per award).
- FY 2024: $255 million awarded to 47 whistleblowers (average $5.43 million per award).
- FY 2025: $60 million awarded to 48 whistleblowers (average $1.25 million per award).
- FY 2026: $88 million awarded to 27 whistleblowers (with a median payout of less than $500,000, excluding outliers).
In drafting the Dodd-Frank Act, the Senate Committee on Banking, Housing, and Urban Affairs explicitly recognized that substantial financial compensation was necessary to offset the severe personal and professional costs of blowing the whistle:
“Recognizing that whistleblowers often face the difficult choice between telling the truth and the risk of committing ‘career suicide’, the program provides for amply rewarding whistleblower(s), with between 10% and 30% of any monetary sanctions that are collected based on the ‘original information’ offered by the whistleblower.”
Whistleblower advocates have argued that the downward trend in median award sizes runs directly counter to this legislation. According to Stephen Kohn, Chairman of the National Whistleblower Center, the SEC’s current administrative practices actively undermine the incentive structure that Congress originally drafted.
“Large awards are the key to incentivizing high-level executive whistleblowers. It is fully documented that larger awards have a significant deterrent effect on wrongdoing. The SEC’s current practice of issuing small awards and using overly technical denials is counterproductive, not in the public interest, and not in the interest of investors. It is self-defeating,” states Kohn.
