The Securities and Exchange Commission Monday awarded more than $20 million to a whistleblower who helped the SEC act “against wrongdoers before they could squander the money.”
The $20 million award is the third biggest since the SEC’s whistleblower program issued its first award in 2012.
Jane Norberg, chief of the SEC’s Office of the Whistleblower, said,
This whistleblower alerted us with a valuable tip that led to a near total recovery of investor funds. Sizeable awards like this one should encourage whistleblowers everywhere that there are real financial incentives to promptly reporting potential securities law violations to the SEC.
According to the SEC’s order, two other whistleblowers were denied awards for the same matter. Their information wasn’t “original,” the SEC said, because it came after the first whistleblower filed his or her claim.
The SEC whistleblower program has now awarded more than $130 million.
The agency is required to protect the confidentiality of whistleblowers. It doesn’t disclose information that might directly or indirectly reveal their identity.
Whistleblowers can be eligible for an award if they provide the SEC with original information that’s “unique and useful” and leads to an enforcement action with sanctions of at least $1 million.
Awards can range from 10 percent to 30 percent of the money collected.
The biggest SEC whistleblower award was more than $30 million in 2014.
The agency made its second biggest award of $22 million in August.
The first FCPA-related whistleblower award was reportedly paid in May. A BHP Billiton insider collected $3.75 million for information about FCPA offenses during the 2008 Beijing Olympics, the reports said.
The SEC said it received about 4,000 tips last year and more than 14,000 since the program started. Tips have come from individuals in all 50 states and the District of Columbia and 95 foreign countries.
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The SEC’s November 14, 2016 Order Determining Whistleblower Award Claim is here (pdf).
Richard L. Cassin is the publisher and editor of the FCPA Blog