Two SEC Whistleblowers Receive More Than $15 Million

The SEC building in Washington, DC

On November 10, the U.S. Securities and Exchange Commission (SEC) announced that two whistleblowers received more than $15 million for their disclosures that led to a successful SEC enforcement action.

According to the award order, one whistleblower will receive more than $12.5 million and the other whistleblower will receive more than $2.5 million. Both whistleblowers “voluntarily provided original information to the Commission that led to the successful enforcement of the Covered Action,” the award order states.

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 Whistleblower Program also offers anti-retaliation protections to whistleblowers. One such protection is confidentiality; thus, the SEC does not disclose any identifying information about award recipients. This award order also redacts information on the total amount of money recovered from the SEC’s enforcement action.

The difference in the two whistleblowers’ award amounts is based upon the information they provided. The award order states that “both whistleblowers provided substantial assistance to the staff in the Division of Enforcement,” but the first whistleblower, who ended up receiving the larger award, provided information that was “more significant” because “it alerted Commission staff to the fraudulent scheme, prompting the opening of the investigation.” The first whistleblower’s information was also “more comprehensive.” The second whistleblower provided information that was “more limited in nature and had less of an impact on the success of the enforcement action.”

“These whistleblowers provided critical information and substantial assistance to the Commission staff in the underlying investigation,” said Emily Pasquinelli, Acting Chief of the SEC’s Office of the Whistleblower, in the SEC’s press release. “These awards demonstrate the SEC’s commitment to rewarding whistleblowers who provide high-quality tips that help protect investors.”

Since the SEC Whistleblower Program awarded its first whistleblower in 2012, the agency has doled out “approximately $1.1 billion to 226 individuals.” SEC whistleblower awards are paid out of “an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators,” the press release states.

Read the award order here.

Read the SEC press release here. 

Read more SEC news on WNN.

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