One whistleblower alerted SEC enforcement staff to misconduct that would become the focus of a staff investigation. That information became the foundation of the agency’s subsequent enforcement action.
The other whistleblower provided information and ongoing cooperation in a staff investigation that resulted in a savings of time and agency resources.
“Whistleblowers have played a crucial role in the progression of many investigations and the success of enforcement actions since the inception of the whistleblower program,” Jane Norberg, chief of the SEC’s Office of the Whistleblower, said. “The value of whistleblowers can be seen in the more than $1 billion in financial remedies ordered against wrongdoers based on actionable information from whistleblowers, including more than $671 million in disgorgement of ill-gotten gains, much of which has been or is scheduled to be returned to harmed investors.”
The SEC’s whistleblower program, which began in 2012, has awarded more than $175 million to 49 whistleblowers. Payments come from an investor protection fund established by Congress that is financed entirely through sanctions paid to the SEC by securities law violators. No money has come from harmed investors to pay whistleblower awards.
Whistleblowers who voluntarily provide the SEC with credible information that leads to a successful enforcement action are eligible for an award. Awards can range from 10 percent to 30 percent of the money collected when the monetary sanctions. The SEC protects the confidentiality of whistleblowers and doesn’t reveal information that might lead to the identity of the whistleblower being discovered.