SEC Whistleblower Lawyer Blog
The Securities and Exchange Commission announced on September 20, 2016 an award of over $4 million to a whistleblower. The whistleblower’s original information alerted the SEC to a fraud.
The SEC whistleblower program was established by Congress in 2011 to incentivize whistleblowers with specific, timely and credible information about federal securities laws violations to report to the SEC. Since its inception, the SEC whistleblower program has awarded more than $111 million to 34 whistleblowers.
The SEC lays out the process for a whistleblower. First, a whistleblower submits a tip to the SEC. The SEC will then analyze and investigate the tip. A case will be filed if the tip is fruitful to the SEC and penalties will be ordered. Notices of the covered actions will then be posted, and the whistleblower will file a claim. Once the SEC determines the award, between 10 and 30 percent of what the SEC collected when monetary sanctions exceed $1 million, a payout will be made to the whistleblower from the Investor Protection Fund.
Thus far, the SEC whistleblower program has been largely successful, thwarting violators before more wrongdoing can occur. The current issues with Wells Fargo are a perfect example of something that might have been avoided had someone blown the whistle sooner. Wells Fargo recently was fined $185 million due to over 5,000 employees creating fake accounts to drive up fees and profit for the company. The fraudulent opening of the accounts span as far back as 2011.
Had a whistleblower come forward earlier to the SEC to investigate the issue, many of the issues affecting Wells Fargo customers may have been avoided.
Confidentiality is no issue for whistleblowers who are apprehensive about being black-balled or retaliated against by the industry. By law, the SEC protects the confidentiality of whistleblowers and does not disclose information that might directly or indirectly reveal a whistleblower’s identity, ensuring that the perpetrators of fraud do not retaliate against the whistleblower.
Scott L. Silver, managing partner of the Silver Law Group, was an early proponent of the legislation and authored a primer on the SEC Whistleblower Program. Our legal team includes former defense attorneys and government prosecutors now working to protect SEC whistleblowers.
Our law firms are committed to the protection of whistleblowers through the whistleblower claim process and can prosecute your whistleblower claims. 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.