The seal of the U.S. Securities and Exchange Commission (SEC) is seen at their headquarters in Washington, D.C., U.S., May 12, 2021. Picture taken May 12, 2021. REUTERS/Andrew Kelly
(Reuters) - A U.S. appeals court on Thursday said a former Royal Bank of Scotland managing director is not owed a multi-million dollar whistleblower award for reporting allegedly unlawful conduct related to mortgage-backed securities, even though his tips helped federal agencies win massive settlements with the bank.
A unanimous three-judge panel of the 2nd U.S. Circuit Court of Appeals said Victor Hong is not eligible for an award because the U.S. Securities and Exchange Commission (SEC) passed along information he provided in 2014 to the Department of Justice rather than bringing its own action against RBS.
RBS in 2017 and 2018 agreed to pay more than $10 billion to settle probes by DOJ and the Federal Housing Finance Agency over its sales of residential mortgage-backed securities in the years leading up to the 2008 financial crisis. The bank denied wrongdoing.
Hong's lawyer, Paul Brown of Archer Byington Glennon & Levine, did not immediately respond to a request for comment. The SEC declined to comment.
RBS was not involved in the case.
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