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SEC issues two separate whistleblower awards totaling over $4.3 million

Securities Whistleblower SEC Enforcement

Securities

On November 5, the SEC announced two separate whistleblower awards totaling over $4.3 million. According to the first redacted order, the SEC awarded a whistleblower more than $3.6 million for (i) providing information that alerted enforcement staff to misconduct occurring abroad that would otherwise “have been difficult to detect”; (ii) providing “substantial and ongoing assistance” to enforcement staff, including traveling to another country to meet with staff in person at the whistleblower’s own expense and providing “extensive supporting documentation”; and (iii) suffering hardships due to the whistleblowing. The SEC further noted in the order that while the whistleblower’s “ministerial role in the underlying misconduct” was considered, the Commission did not reduce the award for culpability as the whistleblower “took exceptional steps to report the misconduct from abroad and provided extraordinary assistance.”

In the second redacted order, the SEC awarded $750,000 to a whistleblower for providing significant information that led to a successful enforcement action. According to the SEC, while the covered action was already open when the whistleblower provided the original information, the whistleblower’s information caused enforcement staff to investigate different conduct, which ultimately formed the basis for the covered action. The whistleblower also met with Commission staff in person and explained “the likely mechanics of the fraudulent scheme.”

The SEC has now paid approximately $719 million to 112 individuals since the inception of the program.

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