On August 10, the U.S. Securities and Exchange Commission (SEC) announced two whistleblower awards totaling nearly $6 million. The awards stem from two separate enforcement actions and were issued to whistleblowers who provided the SEC with information and assistance that contributed to the success of the actions.
Through the SEC Whistleblower Program, qualified whistleblowers are entitled to a monetary award of 10-30% of funds recovered by the government. In addition to monetary awards, the SEC Whistleblower Program offers anti-retaliation protections to whistleblowers. One of these protections is confidentiality; thus, the SEC does not disclose any identifying information about award recipients.
“With today’s orders, the SEC has made whistleblower awards to 14 individuals in less than a month, reflecting the SEC’s commitment to reward whistleblowers who provide new, critical information that leads to successful enforcement actions,” said Emily Pasquinelli, Acting Chief of the SEC’s Office of the Whistleblower.
In the first of the two orders, the SEC awarded a whistleblower $3.5 million. According to the order, the whistleblower “alerted Commission staff of alleged securities laws violations, prompting Enforcement staff to expand an existing investigation into an additional geographic area.” The whistleblower is foreign national who also traveled to meet with SEC staff in person and provide supplemental documents. As the case demonstrates, individuals do not need to be U.S. citizens to be eligible for SEC whistleblower awards.
In the second order, the SEC awarded a whistleblower $2.4 million. According to the order, the whistleblower “alerted Commission staff of alleged securities laws violations after initially reporting concerns internally to [their] employer, prompting staff to open an investigation that led to the Covered Action.” The whistleblower also met with SEC staff, provided additional documents, and identified witnesses.
The SEC Whistleblower Program has been immensely successful and is currently in the midst of a record fiscal year. Overall, the SEC has awarded approximately $956 million to 195 individuals since issuing its first award in 2012.
On August 2, SEC Chair Gary Gensler released a statement detailing plans to revise recently enacted rules to the whistleblower program which were criticized by whistleblower advocates. Gensler voiced his support for whistleblowers at the National Whistleblower Center’s National Whistleblower Day 2021 celebration.