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Robbins LLP News  /  11.06.2020

SEC Whistleblower Awards

SEC Whistleblower Awards on the Rise

Following a record-setting 2020 fiscal year, which just ended on September 30, 2020, the SEC is on track to issue even more awards in 2021.  In 2020, the SEC paid $175 million to 39 individual whistleblowers, which is triple the number of whistleblowers who have been awarded in any past fiscal year.  Both the dollar amount and number of recipients are the highest since 2012 when the program paid its first award.  To kick off fiscal 2020, the SEC awarded a record $114 million on October 22 and $10 million on October 29.  In total, the agency has paid more than $152 million to whistleblowers in just the first month of fiscal 2020 – 87% of what it paid in all of 2020.  The chief of the whistleblower office stated that whistleblowers make significant contributions “to substantially assist investigations and help the commission save time and resources” and she hopes the trend “will continue to incentivize whistleblowers to come forward to report potential fraud and other wrongdoing.”

Recent Changes to the SEC Whistleblower Program

In September, the commission adopted some reforms that will expedite the review process and potentially deliver more money to whistleblowers more quickly.  However, the SEC also determined that it had discretion to lower awards it pays to whistleblowers.  This decision has been met with criticism from whistleblower advocates, who contend that discretion leads to uncertainty and could dissuade tipsters from taking the risks associated with reporting massive frauds.  New provisions affecting outside analysts who uncover fraud and other misconduct through sophisticated research were also met with criticism.

Do You Have Information Helpful to the SEC

Whistleblowers may be eligible for an award when they voluntarily provide the SEC with original, timely, and credible information that leads to successful enforcement actions. Whistleblower awards can range from 10-30% of the money collected when the monetary sanctions exceed $1 million.  In just the last month, tipsters included “company outsiders who provided independent analysis, international whistleblowers who shone a light on hard to detect overseas conduct, and company insiders who provided critical information and substantial assistance that helped the Commission better protect investors and the marketplace.”  Rest assured, the SEC protects the confidentiality of its whistleblowers and does not disclose information that could reveal a whistleblower’s identity.

Since the inception of the program in 2012, the SEC has paid out approximately $715 million to 110 individuals. 

Robbins LLP is here to answer any questions. If you would like to speak with a Robbins LLP Whistleblower attorney, please fill out the form below

  • Please Note:

    Neither the submission to nor the receipt of information by Robbins LLP or one of its attorneys through this website constitutes an agreement by our firm to represent the individual and does not create an attorney-client relationship. Please do not send confidential or sensitive information through this website. This information should be communicated through a direct contact with an individual at the firm.

 

For more information about the Whistleblower program, visit www.sec.gov/whistleblower or our Whistleblower Practice Areas Page.

 

 



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