Consumer Fraud

SEC Awards Whistleblowers Nearly $2 Million For Fraud Tips

stock market global exchange 280x210 SEC Awards Whistleblowers Nearly $2 Million For Fraud TipsThe U.S. Securities and Exchange Commission (SEC) said Wednesday it has awarded three whistleblowers a total of $2 million for information they provided that led to an enforcement action.

One whistleblower who provided tips that prompted the SEC’s investigation will receive about $1.8 million. The Commission said that the individual provided solid, original information at the onset and continued to provide valuable information throughout the course of the investigation.

Two other individuals will receive $65,000 each for providing SEC officials with information after the investigation started.

By law, the SEC does not disclose the identity of whistleblowers who provide tips of fraud and other misconduct. The Commission also does not disclose details about the case that could directly or indirectly expose the identity of a whistleblower.

The SEC’s whistleblower program has awarded more than $57 million to 26 whistleblowers since the program’s inception in 2011. Whistleblowers are eligible to receive an award when they voluntarily provide the Commission with unique and useful information that leads to a successful enforcement action.

Whistleblower awards range from 10 percent to 30 percent of the total money collected when the monetary sanctions exceed $1 million. All award payments are taken from an investor protection fund established by Congress. The fund is financed entirely through monetary penalties paid to the SEC by securities law violators. No money is taken or withheld from harmed investors to pay whistleblower awards.

“We’re seeing a significant uptick in whistleblower tips over prior years, and we believe that’s attributable to increased public awareness of our program and the tens of millions of dollars we’ve paid to whistleblowers for information that helped us bring successful enforcement actions,” said Sean X. McKessy, Chief of the SEC’s Office of the Whistleblower.

Source: Securities and Exchange Commission