The Securities and Exchange Commission announced its largest-ever award of $279 million to a whistleblower, dwarfing its previous record of $114 million in 2020. The securities market regulator did not divulge the case. Still, it likely involves nearly one billion dollars or more in fines (whistleblowers typically get between 10% and 30% of fines over $1 million). This firm was not involved in this case.
The Information provided was very useful
Whistleblowers must voluntarily come forward if they expect a reward. In this case, the person provided essential information tied to a successful enforcement action and two related actions by other agencies using the same information the whistleblower provided. The SEC had already opened an investigation of the unnamed company, and the staff was apparently aware of potential misconduct. Still, the whistleblower enabled the regulatory agency to expand its probe and provided additional ongoing assistance in writing and through interviews.
More to come
The SEC and some other government agencies have said more than once that they would increase the size of the fines and awards to curb Wall Street fraud. The SEC reiterated this message with its blockbuster award’s May 5th announcement.
“The size of today’s award – the highest in our program’s history – not only incentivizes whistleblowers to come forward with accurate information about potential securities law violations, but also reflects the tremendous success of our whistleblower program,” said Gurbir S. Grewal, the SEC’s Division of Enforcement director.