Whistleblower business – SEC awards more than $4.7M in four cases

Whistleblowing has long since become a billion-dollar business in the United States, involving whistleblowers, lawyers, and private investigators. It is a lucrative business. Over the last seven days, the U.S. Securities and Exchange Commission (SEC) announced awards totaling more than $4.7M.  The SEC has awarded approximately $752 million to 138 individuals since issuing its first award in 2012.

The four cases

The whistleblower awards were made in four separate cases:

1. In the first case, the regulator awarded a whistleblower over $2.2 million for providing important, high-quality information that aided an investigation. The whistleblower’s tip helped the SEC bring an enforcement action that resulted in the return of millions of dollars to harmed clients. 
2. In a second case, the SEC awarded almost $700,000 to a whistleblower who alerted SEC staff to a fraudulent reporting scheme, prompting the opening of the investigation. The whistleblower provided critical evidence to the staff and helped identify key documents and witnesses.
3. In the third case, the SEC awarded a whistleblower over $900,000 in connection with an enforcement action. The whistleblower provided significant evidence, including a critical declaration, that helped expedite an ongoing investigation and enabled the SEC to shut down an ongoing fraudulent scheme preying on retail investors.
4. In the fourth case, the SEC awarded a whistleblower over $800,000 for providing important evidence of false and misleading statements made to investors, resulting in the return of millions to harmed investors.  The whistleblower assisted the SEC by participating in an interview and producing documents. 

SEC Whistleblower Funding

All payments in the SEC’s Whistleblower Program 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 successful enforcement action. Whistleblower awards can range from 10-30% of the money collected when the monetary sanctions exceed $1 million.