On November 30, 2017, the Securities and Exchange Commission announced two whistleblower awards in excess of $8 million. The bounties were awarded to 2 individual whistleblowers whose information was instrumental in the SEC investigations, and who’s continuing assistance and cooperation substantially assisted the SEC in successfully bringing the underlying enforcement actions.
SEC enforcement actions sourcing from whistleblower tips have resulted in more than $1 billion in financial remedies ordered against securities and investment firms since 2012.
One of the whistleblowers in the recent awards alerted the SEC enforcement staff of misconduct that would become the central focus of the staff’s investigation and the centerpiece of the SEC’s subsequent enforcement action. The second whistleblower at the same firm provided additional significant information and ongoing cooperation to the staff during the investigation resulting in a substantial savings of time and agency resources.
“Whistleblowers have played a crucial role in the progression of many investigations and the success of enforcement actions since the inception of the whistleblower program,” said Jane Norberg, Chief of the SEC’s Office of the Whistleblower. “The value of whistleblowers can be seen in the more than $1 billion in financial remedies ordered against wrongdoers based on actionable information from whistleblowers, including more than $671 in disgorgement of ill-gotten gains, much of which has been or is scheduled to be returned to harmed investors.”
To date, the SEC’s whistleblower program has awarded in excess of $175 million to 49 whistleblowers since issuing its first award in 2012. All payments are made exclusively from an investor protection fund established by Congress financed completely through monetary sanctions paid to the SEC by securities law violators. No money is ever taken or withheld from harmed investors to pay whistleblower awards.
By law, the SEC protects the confidentiality of whistleblowers and does not disclose information that might directly or indirectly reveal a whistleblower’s identity.
The SEC whistleblower program offers confidentiality, protection from retaliation, and rewards fraud tipsters for reporting wrongdoing that leads to an SEC enforcement action in which over $1 million in sanctions is collected. The award can range anywhere from 10 to 30 percent of the sanctions, according to the website.
Scott L. Silver, the managing partner of the Silver Law Group, was an early proponent of the legislation and authored a primer on the SEC Whistleblower Program.
David R. Chase, the managing partner of the Law Firm of David R. Chase, P.A., is a former SEC prosecutor who now represents SEC whistleblowers.
Silver Law Group and The Law Firm of David R. Chase are committed to the protection of whistleblowers through the SEC whistleblower claim process and can prosecute your whistleblower claim. If you have questions about your legal rights as a whistleblower, please contact Scott Silver of the Silver Law Group for a free consultation at ssilver@silverlaw.com or toll-free at (800) 975-4345.