On October 15, the U.S. Securities and Exchange Commission (SEC) announced it issued whistleblower awards totaling over $40 million. The agency has now issued seven whistleblower awards since the 2022 fiscal year began on October 1, 2021. The 2021 fiscal year was a record-setting year for the SEC Whistleblower Program.
The awards granted on October 15 included a $32 million and $8 million award issued in connection with the same enforcement action. The first whistleblower received a much larger award because the SEC determined that they “contributed substantially more to the success of the Covered Action” than the second whistleblower, according to the award order. Furthermore, while the first whistleblower “persistently alerted the Commission to the ongoing abusive practices for a number of years before the investigation was opened,” the second whistleblower “delayed reporting to the Commission for several years after becoming aware of the wrongdoing.”
“Today’s whistleblowers underscore the importance of the SEC’s whistleblower program to the agency’s enforcement efforts,” said Emily Pasquinelli, Acting Chief of the SEC’s Office of the Whistleblower. “These whistleblowers reported critical information that aided the Commission’s investigation and provided extensive, ongoing cooperation that helped the Commission to stop the wrongdoing and protect the capital markets.”
The other award issued on October 15 was a $300,000 award granted to a whistleblower who “alerted Enforcement staff to the potential wrongdoing, prompting the opening of the investigation.”
On October 12, the SEC issued a whistleblower award for approximately $1.3 million. According to the award order, the whistleblower “provided significant information that prompted the opening of the investigation by the Commission staff, participated in multiple interviews with Commission staff, and continued to provide helpful information over a two year period.”
On October 8, the SEC issued two separate whistleblower awards: one for $100,000 and one for a yet to be determined amount. This second award will be for the statutory maximum percentage but no collections have been made in connection with the case yet to determine the exact size of the award. Both whistleblowers provided the SEC with original information that led to the opening of an investigation.
On October 1, the SEC awarded $1.7 million to a whistleblower who “provided new, detailed, and highly valuable information that prompted the opening of the investigation and provided substantial assistance during the course of the investigation,” according to the award order.
In the 2021 fiscal year, the SEC awarded over $500 million to over 100 individual whistleblowers. Both of these figures were far greater than previous fiscal year records. During the 2021 fiscal year, the SEC also set the record for single largest whistleblower award when it issued a $114 million award. Overall, since issuing its first award in 2012, the SEC has awarded approximately $1.1 billion to 218 individuals.
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.
SEC Awards $40 Million to Two Whistleblowers