The Securities and Exchange Commission (SEC) has announced an award of more than $10 million to a whistleblower who “provided information and assistance that significantly contributed to a successful SEC enforcement action.”
According to the statement from the SEC, the whistleblower provided important documents and met twice with enforcement staff. The charges in the covered action had a close nexus with the whistleblower’s allegations, which were critical to the underlying investigation.
“The whistleblower awarded today provided information that resulted in the return of a significant amount of money to harmed investors,” said Creola Kelly, chief of the SEC’s Office of the Whistleblower. “This illustrates how the Whistleblower Program works to benefit, via financial remediation, investors who are victimized by those who violate our securities laws.”
All SEC whistleblower awards are paid out of an investor protection fund which is fully financed by sanctions collected thanks to whistleblowers. No taxpayer dollars are used to pay whistleblowers. Qualified SEC whistleblowers are entitled to awards of 10-30 percent of the funds collected by the government in the relevant enforcement action. Thus, 70-90 percent of all sanctions collected thanks to a whistleblower are returned to harmed investors, the U.S. Treasury, and the SEC Investor Protection Fund.
SEC Chair Gary Gensler praised the SEC Whistleblower Program, noting that it “has greatly aided the commission’s work to protect investors.” He explained that “[i]n the years since the program was established, the SEC has used whistleblower information to obtain sanctions of over $5 billion from securities law violators, return over $1.3 billion to harmed investors, and award over $1.3 billion to whistleblowers for their service.”