October 15, 2021/US SEC
The Securities and Exchange Commission today announced awards of approximately $40 million to two whistleblowers whose information and assistance contributed to the success of an SEC enforcement action.
The first whistleblower, whose information caused the opening of the investigation and exposed difficult-to-detect violations, will receive an award of approximately $32 million. The first whistleblower also provided substantial assistance to the staff, including identifying witnesses and helping the staff to understand complex fact patterns. The second whistleblower, who submitted important new information during the course of the investigation but waited several years to report to the Commission, will receive an award of approximately $8 million.
“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 SEC has awarded approximately $1.1 billion to 218 individuals since issuing its first award in 2012. All payments are made out of an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators. No money has been taken or withheld from harmed investors to pay whistleblower awards. Whistleblowers may be eligible for an award when they voluntarily provide the SEC with original, timely, and credible information that leads to a successful enforcement action. Whistleblower awards can range from 10-30% of the money collected when the monetary sanctions exceed $1 million.
As set forth in the Dodd-Frank Act, the SEC protects the confidentiality of whistleblowers and does not disclose information that could reveal a whistleblower’s identity.
For more information about the whistleblower program and how to report a tip, visit www.sec.gov/whistleblower.