On March 8, the U.S. Securities and Exchange Commission (SEC) issued a $3.5 million whistleblower award to an individual who voluntarily provided the agency with original information that contributed to two successful enforcement actions. According to the SEC, the whistleblower’s information was “critical” and “significantly contributed” to the enforcement actions.
Through the SEC Whistleblower Program, qualified whistleblowers are entitled to a monetary award of 10-30% of funds recovered by the government when the sanctions that the government recovers exceed $1 million. The SEC weighs a number of factors when determining the exact percentage for a whistleblower award.
The award order for the $3.5 million award states that the whistleblower “provided information that significantly contributed to the success of the Covered Action, including providing new information that caused Commission staff to further investigate certain potential securities violations that were included in the Covered Action.” It further notes that the whistleblower’s information “saved Commission time and resources and helped advance settlement discussions.”
“Whistleblowers play an integral role in the agency’s enforcement efforts and protection of investors,” said Creola Kelly, Chief of the SEC’s Office of the Whistleblower. “In fiscal year 2022 alone, the SEC has awarded more than $143 million to whistleblowers who provided high-quality information and assistance that led to the success of enforcement actions.”
Overall, the SEC has awarded approximately $1.2 billion to 248 whistleblowers since issuing its first award in 2012. In the 2021 fiscal year, the SEC Whistleblower Program set several records. During the fiscal year, the SEC awarded approximately $564 million to 108 individuals.
In addition to monetary awards, the SEC Whistleblower Program offers anti-retaliation protections to whistleblowers. One such protection is confidentiality; thus, the SEC does not disclose any identifying information about award recipients.