On January 13, the U.S. Securities and Exchange Commission (SEC) awarded more than $5 million to a whistleblower who voluntarily provided original information to the SEC that led to a successful enforcement action.
According to the award order, the whistleblower “submitted a tip and additional information that helped Commission staff shape its investigative strategy, identify witnesses, and draft document and information requests and subpoenas, saving Commission time and resources during the investigation.”
The order further notes that the whistleblower “provided substantial ongoing assistance to investigative staff and had internally reported concerns prior to submitting information to the Commission.”
“The whistleblower in this case provided helpful information and substantial ongoing assistance, saving the SEC time and resources during its investigation,” said Creola Kelly, Chief of the SEC’s Office of the Whistleblower.
Through the SEC Whistleblower Program, the SEC pays monetary awards to individuals who voluntarily disclose information that leads to a successful enforcement action. These awards are for 10-30% of the sanctions collected in the successful action.
On January 6, the SEC issued a $5 million whistleblower award, its first in 2023. The award was issued to an individual who voluntarily provided original information that led to the opening of an investigation.
In Fiscal Year 2022, the SEC “awarded approximately $229 million in 103 awards, making FY 2022 the Commission’s second highest year in terms of dollar amounts and number of awards,” according to the Whistleblower Office’s Annual Report to Congress.
The report also states that “Enforcement actions brought using information from meritorious whistleblowers have resulted in orders for more than $6.3 billion in total monetary sanctions, including more than $4.0 billion in disgorgement of ill-gotten gains and interest, of which more than $1.5 billion has been, or is scheduled to be, returned to harmed investors.”