The Securities and Exchange Commission (SEC), the US securities markets regulator, has awarded more than US$1 billion in awards to whistleblowers since its whistleblower programme was introduced in 2012.
The Commission says that these payments, made to 207 individuals over the term of the programme, are made out of an investor protection fund established by Congress that is financed from monetary sanctions paid to the SEC by those who have violated securities laws.
More than US$500 million has been paid out to whistleblowers during the 2021 fiscal year, according to the financial watchdog.
Awards can range from 10 to 30 per cent of money collected when the financial sanctions exceed US$1 million.
Its two latest awards, for sums of approximately US$110 million and US$4 million, were paid to two whistleblowers whose information and evidential assistance led to successful actions by the SEC and related authorities.
Whistleblowers may be eligible for an award when they voluntarily provide credible, original and timely information to the SEC that leads to successful enforcement action.
SEC director of division of enforcement Gurbir Grewal says: “The whistleblower programme has been instrumental to the success of numerous enforcement actions since it was instituted a decade ago. We hope that today’s announcement encourages whistleblowers to continue to come forward with credible information about potential violations of the securities laws”.
SEC chair Gary Gensler comments: “Today’s announcement underscores the important role that whistleblowers play in helping the SEC detect, investigate and prosecute potential violations of the securities laws. The assistance that whistleblowers provide is crucial to the SEC’s ability to enforce the rules of the road for our capital markets.”
