Whistleblowers reap $4 million in awards for providing info to SEC
Whistleblowers will be paid $4 million for providing information that aided the Securities and Exchange Commission’s enforcement program, the agency reported.
Credible and specific tips about securities laws violations are of great assistance to the SEC’s enforcement program, said Scott Williams, CEO of Ethic Alliance.
“Our financial markets require the help of the populace to police wrongdoing effectively, which is why whistleblower laws are so incredibly important,” Williams said.
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). 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 with us, 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.
On May 6, 2022, the SEC announced a total award of nearly $3.5 million to four whistleblowers who provided information and assistance in a single covered action. The SEC protects the confidentiality of whistleblowers and does not disclose any information that could reveal a whistleblower’s identity.
"Today’s whistleblowers provided valuable information that assisted the Commission’s investigation," said Creola Kelly, chief of the SEC’s Office of the Whistleblower, in a statement.
Three joint whistleblowers provided SEC staff with information that caused the staff to open a new investigation that led to the successful enforcement action against an unidentified company. information also caused another agency to open an investigation which led to a separate successful action. Another whistleblower provided insights based on an analysis of publicly available information that focused the staff’s attention on new allegations that advanced the investigation.
On April 27, 2022, the SEC announced an award of $500,000 to a whistleblower who provided information that led to a successful enforcement action against another unidentified company. While the SEC did not disclose much about the case, the SEC did say the whistleblower filed a complaint against the company with another federal agency that suggested a potential securities-law violation.
The SEC says it has awarded approximately $1.3 billion to 273 individuals since issuing its first award in 2012. All payments are made out of an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators. No money has been taken or withheld from harmed investors to pay whistleblower awards. Whistleblowers may be eligible for an award when they voluntarily provide the SEC with original, timely, and credible information that leads to a successful enforcement action. Whistleblower awards can range from 10 percent to 30 percent of the money collected when the monetary sanctions exceed $1 million.
Contact Ethic Alliance at info@ethicalliance.com
Related links: https://www.sec.gov/news/press-release/2022-80
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