On August 6, the U.S. Securities and Exchange Commission (SEC) announced whistleblower awards totaling more than $3.5 million. The awards stem from two separate enforcement actions and were issued to three separate individuals. With these awards, the SEC Whistleblower Program has now issued approximately $950 million in whistleblower awards since the program issued its first award in 2012.
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.
In connection with the first enforcement action, the SEC awarded an individual approximately $2 million. According to the award order, the whistleblower “alerted the Commission to the on-going fraud prompting the opening of an investigation into the alleged conduct, participated in multiple voluntary interviews with Commission staff, and provided documents and additional information that assisted the staff in its investigation, saving Commission staff time and resources.”
In connection with the second enforcement action, the SEC issued two separate whistleblower awards. One whistleblower received approximately $1 million and a second whistleblower received approximately $500,000. According to the award order, the first whistleblower’s disclosure “served as a roadmap for the staff’s investigation.” The first whistleblower additionally provided ongoing assistance throughout the investigation.
The second whistleblower received a smaller award because, according to the order, “while [the second whistleblower’s] independent analysis was helpful to the staff by narrowing the investigation’s focus and by assisting with the crafting of a subpoena, it was less impactful as compared to [the first whistleblower’s] information.”
“Whistleblowers can provide a wealth of information and ongoing assistance that helps the SEC bring enforcement actions quicker and more efficiently,” said Emily Pasquinelli, Acting Chief of the SEC’s Office of the Whistleblower. “Today’s whistleblowers not only stepped forward to report suspicious conduct, but also continued to provide critical additional assistance.”
The SEC Whistleblower Program has been immensely successful and is currently in the midst of a record fiscal year. 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.