Jane Norberg Steps Down After Landmark Run As SEC Whistleblower Chief

Jane Norberg, Chief of the SEC’s Office of the Whistleblower, will step down this month after five groundbreaking years.  Norberg played a pivotal role in shaping the SEC Whistleblower Program into a model for how empowering whistleblowers can revolutionize government enforcement.  Her tenure brought record payouts to whistleblowers, a streamlined award process, and a firm stand against any attacks on the public’s right to blow the whistle.

Without question, Norberg leaves behind a remarkable legacy and big shoes to fill.

Record-Smashing Awards

Blockbuster whistleblower awards have been the hallmark of Norberg’s tenure.  During her time as Chief, the SEC has paid out nearly $650 million to more than 110 whistleblowers, including nine of the ten largest awards in the program’s history.  For example, in late 2020, the SEC made a mammoth $114 million award, its largest to date.

These big awards reflect big SEC successes. The whistleblower awards under Norberg stemmed from enforcement actions that recovered $3.1 billion in sanctions.  And more than $760 million of that has or will be returned to victimized investors.  Norberg has always championed the role of whistleblowers, recognizing that when properly protected and incentivized, they would transform the SEC’s enforcement efforts.  That is exactly what she accomplished as Chair of the Whistleblower Office.

Breaking the Award Logjam

Under Norberg’s leadership, the SEC didn’t just pay its largest awards—it also paid them faster.  Whistleblower advocates have long complained about the slow pace of the SEC program, where meritorious award claims have languished for years after the SEC recovered sanctions from the fraudsters and cheats.  But the SEC has recently broken through this longstanding logjam that left whistleblowers in the lurch.

By staffing up and streamlining the awards process, Norberg and her team eliminated the bottleneck and ushered in a record-breaking year in Fiscal Year 2020, tripling the number of awards paid to whistleblowers.  But that record did not last long.  In the first six months of Fiscal Year 2021, the Whistleblower Office has raised the bar once again by awarding $200 million to 40 individuals, already eclipsing the 2020 mark in half the time.

This is an extraordinary accomplishment.  Whistleblowers will now be more promptly rewarded for their courageous and indispensable efforts to report fraud and corruption in the securities markets.  Norberg should be commended for addressing this longstanding issue and eliminating one of the few weaknesses in an otherwise exemplary whistleblower program.

Protecting the Right to Report Fraud

Norberg also oversaw a surge of enforcement activity that preserved the right to blow the whistle.  In the earlier years of the Whistleblower Program, employers often tried to prevent whistleblowing through employment contracts that deterred or outright banned employees from reporting misconduct to the SEC, or by retaliating against those who did.

Norberg attacked these coercive tactics head-on.  Over her five years, the SEC brought eight enforcement actions for violations of the SEC rule against “impeding” whistleblowing, as well as three cases for retaliating against whistleblowers.  In public comments, Norberg made clear that the SEC was drawing a red line that employers should not cross: “Companies simply cannot disrupt the lines of communications between the SEC and potential whistleblowers.”

Companies got the message loud and clear.  These enforcement actions completely reshaped corporate practices.  Thanks to the SEC’s robust enforcement, companies today have largely abandoned contract terms that chill whistleblowers from reporting misconduct to the SEC.  And as a result, more whistleblowers are coming forward than ever before.

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Given Norberg’s long list of accomplishments, the SEC will be hard-pressed to find a greater champion for the importance of whistleblowers.  But thankfully, the SEC has already reiterated its firm commitment to the Whistleblower Program.  Norberg will be sorely missed, but the SEC Whistleblower Program will remain as strong as ever.

READ MORE

• As SEC Whistleblower Chief Norberg Moves On, the Agency Reinforces Its Warm Embrace of Whistleblowers
• The SEC Whistleblower Program
• SEC Enforcement Actions
• Financial & Investment Fraud
• Securities Fraud
• The Constantine Cannon Team

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