SEC Pays Whistleblower $2.4 Million For A “Timely Submission” That Halted “Ongoing Misconduct”

The SEC announced on Monday that it had awarded $2.4 million to a whistleblower whose “timely submission of information prompted the agency to initiate an investigation and bring an enforcement action that stopped ongoing misconduct”.

The SEC said the whistleblower’s continued assistance helped them bring charges against the wrongdoing. 

Jane Norberg, Chief of the SEC’s Office of the Whistleblower, said: “The whistleblower awarded today quickly came forward with critical information and helped investigative staff target key information and identify important witnesses. Information from whistleblowers has again proven to be crucial in helping the Commission detect violations and better protect investors and the marketplace.”

This is the second such meaningful award announced within the last week by the SEC. Recall, just about a week ago, we noted when the SEC doled out more than $10 million to an unnamed “persistent” tipster.

Norberg said at the time: “This award recognizes the persistent efforts of the whistleblower to expose serious financial misconduct.”

“This whistleblower also provided extensive and ongoing assistance to the investigative team over the course of the investigation, including identifying witnesses and helping staff understand complex fact patterns and issues related to the matters under investigation,” she said.

In sum, the SEC has awarded about $520 million to 94 separate people since issuing its first whistleblower award in 2012. Payments for the awards are “made out of an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators,” the release noted.

Whistleblowers can be eligible for an award when they provide the SEC with “original, timely, and credible information that leads to a successful enforcement action,” according to the agency.

Awards often range from 10% to 30% of money collected when sanctions bestowed by the SEC exceed $1 million.