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SEC Makes Record Whistleblower Award of $114 Million

Posted  October 29, 2020

Following on the heels of a record-breaking year for SEC whistleblower awards, the SEC broke new ground yet again with its blockbuster award last week of $114 million.  It far exceeds the next highest award of $50 million the SEC made in June.  And it brings to $676 million to 108 whistleblowers the total tally to date of awards under the SEC Whistleblower Program.

Other than its size, another notable feature about this ground-breaking award is that more than half of it ($62 million) originated from the government’s recovery through another undisclosed agency.  The SEC Whistleblower Program provides for such “related” awards if the information the whistleblower provides that leads to an SEC recovery also leads to a recovery by another agency.  Related awards like this are rare under the SEC program and this may be the only one that actually exceeded the SEC portion of the award.

The SEC did not explain how it calculated the $114 million award.  Nor did it identify what percentage it comprised of the total amount the SEC or other agency recovered.  However, in its Order, the SEC provided some indication of the factors that went into its award determination:

  • The whistleblower’s information caused the SEC and other agency to open investigations and alerted their staff to wrongdoing.
  • The whistleblower provided substantial and ongoing assistance to the SEC throughout its investigation.
  • The whistleblower suffered serious personal and professional hardship.
  • The whistleblower reported the concerns internally to the company.

This latest award not only follows a banner year for SEC whistleblower awards.  It follows an avalanche of awards the agency doled out last month to close out its fiscal year.  That included 15 awards for a total of more than $50 million in September, with six of them on the last day of the month.  And as it did with these awards, and with all awards it makes under the program, the agency trumpets the critical role whistleblowers play in SEC enforcement.

This latest award was no different with SEC Chairman Jay Clayton himself highlighting the importance of whistleblowers and the agency’s commitment to reward them for coming forward with high-quality information:

Whistleblowers make important contributions to the enforcement of securities laws and we are committed to getting more money to whistleblowers as quickly and as efficiently as possible.

The Chair of the SEC’s Whistleblower Office Jane Norberg added that “the actions of the whistleblower awarded today were extraordinary.”

The major takeaway here, as the SEC keeps reminding us, is that the agency continues to be very much open for whistleblower business.  So if you believe you might have useful information regarding potential securities fraud violations and would like to speak to an experienced member of the Constantine Cannon whistleblower lawyer team, please do not hesitate to contact us.  When it comes to reporting to the SEC, there has never been a better time to say something if you see something.

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Tagged in: Financial and Investment Fraud, SEC Whistleblower Reward Program, Securities Fraud, Whistleblower Rewards,