Whistleblowers making a ‘tremendous contribution’ to protecting investors

Apr 5

Fiscal year 2021 was another record-breaking year for the U.S. Securities and Exchange Commission’s whistleblower program.

“Whistleblowers make a tremendous contribution to the agency’s ability to detect securities law violations and protect investors and the marketplace,” said Emily Pasquinelli, Acting Chief, Office of the Whistleblower, in the office’s annual report to Congress released November 15, 2021.

Fiscal Year 2021 (the 12 months ending in September 2021) marked milestones including the highest number of awards, both in terms of dollars and individuals awarded, and the largest number of whistleblower tips received by the Securities and Exchange Commission. More significantly, the Commission made more whistleblower awards in Fiscal Year 2021 than in all prior years combined.

In Fiscal Year 2021, the Commission awarded approximately $564 million to 108 individuals —both the largest dollar amount and the largest number of individuals awarded in a single fiscal year.

The awards made in FY 2021 also include the Commission’s two largest awards to date—a $114 million award to one whistleblower made in October 2020, and a combined $114 million award to two whistleblowers made in September 2021. The Commission also issued an over $50 million award to joint whistleblowers in April 2021.

“These large awards underscore the Commission’s commitment to rewarding whistleblowers who provide specific and detailed information that plays a significant role in the success of the agency’s enforcement actions,” Pasquinelli said.

The Securities and Exchange Commission’s appreciation for the contributions of whistleblowers demonstrates why potential whistleblowers should contact Ethic Alliance, said Scott Williams, the organization’s CEO.

“In the securities world, the contributions of whistleblowers towards protecting the integrity of our financial markets go well beyond simply making a report. The SEC often relies on the expertise of whistleblowers to win these cases, especially when dealing with enforcement actions in niche markets that only a handful of people truly understand,” said Williams.

Ethic Alliance is a for-profit corporation and law firm whose purpose is to empower, educate and protect whistleblowers, ensuring they receive the protection they need and the rewards they are entitled to under US law (the US government will typically reward whistleblowers 10%-30% of the amount recovered or sanctioned under various whistleblower laws), generating profits for investors while reducing corruption, fraud, theft, lying and cheating in our society.

Ethic Alliance protects whistleblowers through a secure, encrypted reporting and messaging platform, attaching the strong legal protection of attorney-client privilege from the moment a report is filed, and access to a network of specialty attorneys that have made careers protecting and supporting whistleblowers, and working with the US government to win whistleblower lawsuits.

Contact Ethic Alliance at info@ethicalliance.com

The Securities and Exchange Commission says it received over 12,200 whistleblower tips in Fiscal Year 2021—an approximate 76% increase from FY 2020, the second highest tip year, and a more than 300% increase since the beginning of the program. As in prior fiscal years, tips received this fiscal year came from a variety of geographic origins, both domestic and foreign. The Commission received tips from individuals in 99 foreign countries, as well as from every state in the United States and the District of Columbia, Pasquinelli said.

“The success of the Commission’s whistleblower program in landmark FY 2021 demonstrates that it is a vital component of the Commission’s enforcement efforts,” Pasquinelli said. “We hope the awards made this year continue to encourage whistleblowers to report specific, timely, and credible information to the Commission, which will enhance the agency’s ability to detect wrongdoing and protect investors and the marketplace.”

Whistleblowers need not worry that any awards they receive is money out of the pockets of securities fraud victims. To ensure that whistleblower payments would not diminish the amount of recovery for victims of securities law violations, Congress established a separate fund, called the Investor Protection Fund (Fund), from which eligible whistleblowers are paid.

Photo by Cytonn Photography on Unsplash

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