On August 2, the U.S. Securities and Exchange Commission (SEC) awarded $500,000 to two whistleblowers. Both whistleblowers voluntarily provided the SEC with original information that led to a successful enforcement action.
Through the SEC Whistleblower Program, qualified whistleblowers are entitled to awards of 10-30% of the funds recovered by the government in the relevant enforcement action. In addition to offering monetary awards, the SEC Whistleblower Program also offers anti-retaliation protections to whistleblowers. One such protection is confidentiality; thus, the SEC does not disclose any identifying information about award recipients.
In determining the exact percentage to award a whistleblower, the SEC weighs a number of factors including timeliness of the disclosure, significance of the information, and culpability. According to the award order, in reaching its determination for the first whistleblower, the SEC “considered that [the whistleblower] provided information that served as important evidence of a fraud and supported the Commission’s findings in the Covered Action.” The SEC further notes that “[the whistleblower] and/or his/her counsel met with Enforcement staff on multiple occasions.”
In determining the award percentage for the second whistleblower, the SEC “considered that [the whistleblower] provided information that identified a fraudulent transaction and provided unique documentation that served as the basis for some of the Commission’s findings...
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