Another Million Reward to a Whistleblower by SEC
A whistleblower has been awarded more than $37 million by the Securities and Exchange Commission (SEC), which made the announcement today. The information provided by the individual who blew the whistle was instrumental in the successful prosecution of an SEC enforcement action and a related action.
The information provided by the whistleblower served as the basis for the initial investigation conducted by the company itself, as well as for investigations conducted by the SEC and another agency.
Even though the company reported the allegedly improper behavior to the SEC and the other agency, the whistleblower receives credit for the investigations being initiated because the individual provided the same information to the SEC within 120 days of providing it internally. This allowed this individual to receive credit for the investigations being initiated.
According to Creola Kelly, Chief of the SEC’s Office of the Whistleblower, “The individual here made persistent efforts to bring the conduct to the attention of the SEC, another agency, and the company, and is credited with the results of the company’s internal investigation.
Payments to whistleblowers come from an investor protection fund that was established by Congress. This fund receives all of its funding from monetary sanctions that lawbreakers in the securities industry are required to pay to the SEC. There has been no theft or withholding of funds from investors who have been harmed in order to pay whistleblower awards.
When individuals who blow the whistle in an organization voluntarily provide the Securities and Exchange Commission (SEC) with original, timely, and credible information that results in a successful enforcement action, they may be eligible for an award. When the monetary sanctions total more than one million dollars, awards for whistleblowers can range from 10 to 30 percent of the total amount collected.
The Dodd-Frank Act requires that the Securities and Exchange Commission (SEC) protect the confidentiality of these individuals and refrain from disclosing any information that could lead to the identity of a person who blew the whistle.
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