The Securities and Exchange Commission announced yesterday over $7 million reward to a whistleblower who provided crucial information and assistance in a SEC action in a securities law violation and helped form part of the basis for charges. The whistleblower provided useful information at the early stages of the investigation, helping the agency preserve time and resources.
Whistleblower awarded $1.6 Million
Jane Norberg, Chief of the SEC’s Office of the Whistleblower commented:
The violations would have been difficult to detect without the whistleblower’s information and assistance. This matter highlights the importance of the SEC’s whistleblower program to the agency’s enforcement efforts and to its ability to maximize staff resources.
So far, the agency has awarded over $395 million to 74 individuals for their help since the first award was issued in 2012. Payment of the awards is taken out of an investor protection fund set up by Congress. It is financed through monetary sanctions of security law violations paid to SEC.
To be eligible for award, a whistleblower needs to voluntarily provide the commission with reliable information that leads to successful enforcement action. The awards range between 10 and 30 % of the money collected by SEC when the sanction is for more than $1 million.
According to the Dodd-Frank Act, SEC must protect the identity of the whistleblower and not disclose any information that could reveal it.