Securities Arbitration Lawyer Blog
On August 27, 2021, the Securities and Exchange Commission (“SEC”) announced whistleblower awards of roughly $2.6 million to five whistleblowers in three separate regulatory enforcement proceedings. In total, over $16 million has been awarded to SEC whistleblowers this month.
In the first regulatory enforcement proceeding, a whistleblower was awarded approximately $1.2 million for providing the regulator with independent analysis based upon a complex algorithm the whistleblower developed and applied to publicly available data. The information was valuable to the SEC and saved the agency time and resources.
In the second SEC enforcement proceeding, more than $1 million was awarded to three compliance personnel whose information led to a successful regulatory enforcement action. The whistleblower that received the highest award provided “extraordinary assistance and comprehensive information,” according to the SEC’s press release.
Finally, in a third SEC AWARD Order, more than $350,000 was awarded to an individual who provided the SEC with an independent analysis. The individual identified patterns among publicly available information that allowed the SEC to quickly identify and prevent wrongdoing and to preserve assets.
In total, the SEC has awarded over $959 million to 203 individuals since the whistleblower program became effective in August 2011. The awards are paid out of an investor protection fund established by Congress financed entirely through monetary sanctions paid to the SEC by securities law violators. Money is not taken or withheld from harmed investors to pay whistleblower awards.
Congress established the whistleblower program to incentivize whistleblowers with specific, timely, and credible information about federal securities law violations to report to the SEC. A whistleblower may receive an award if they voluntarily provide the SEC with qualifying information, leading to successful enforcement. The award can range from 10 percent to 30 percent of the money collected due to the enforcement action.
Whistleblowers play an important role in fighting corruption, protecting retail investors, and maintaining a free and healthy market. Iorio Altamirano LLP, an investor advocate law firm, is committed to the effective representation of whistleblowers.
Individuals who have information regarding fraud or other violations of federal securities laws should contact whistleblower law firm Iorio Altamirano LLP for a free consultation to review your legal rights on how to file a whistleblower tip to the SEC and preserve eligibility to receive a whistleblower award.