The U.S. Securities and Exchange Commission has awarded a whistleblower with more than $700,000 after the whistleblower’s reports to the agency resulted in a successful enforcement action. Three other whistleblowers were denied awards, according to the SEC’s case order.
This large sum was just the latest awarded handed out under the SEC’s whistleblower program, which has paid more than $55 million to 23 individuals since the program was founded in 2011 — including a record $30 million award to one whistleblower last year. Individuals who voluntarily come to the SEC with “unique and useful” statements that lead to a successful SEC enforcement action could be eligible for cash rewards. Those rewards range from 10 to 30 percent of the total money collected in sanctions, if the sanctions exceed $1 million.
Independent investigator uncovered wrongdoing
The SEC did not specify which organization was the subject of the claim or what the total value of the claim was worth. However, Enforcement Chief Andrew Ceresney said this case was a reminder that the “voluntary submission of high-quality analysis by industry experts can be every bit as valuable as first-hand knowledge of wrongdoing by company insiders.” The whistleblower who received the award was not an employee of the company, but rather a third-party investigator who conducted a detailed analysis of the organization in question.
Considering the enhanced role the SEC is playing in providing awards to whistleblower, it’s important for businesses and organizations to have sound compliance standards in place. They also need to thoroughly investigate if any whistleblower claims come forward. To learn more, consult a skilled Dallas attorney with Whistleblower Law for Managers.
