The US Securities and Exchange Commission (SEC) has awarded $50M to two individuals who acted as whistleblowers, helping the regulator to render a successful enforcement action because of the quality information they provided. Details of the enforcement action and the identity of the whistleblowers are not disclosed so as to protect their identities. However, the SEC did announce that one of the whistleblower awards is for $37M and the other is for $13M.
The SEC awards individuals that voluntarily share unique, credible, timely, and relevant information that then leads to a successful enforcement action when the resulting monetary sanctions imposed is more than $1M. 10-30% of that may then be awarded to the SEC whistleblower , or in some case, the whistleblowers.
Since the inception of the SEC whistleblower program in 2012, the regulator has awarded 61 individuals about $376M. All whistleblower awards come out of an investor protection fund set up by Congress. Money in the funds come out of monetary sanctions that have been paid to the Commission. Whistleblower awards are never taken out of any funds that investors who sustained losses from fraud might be able to recover.
CFTC Awards Whistleblower $2M
The SEC isn’t the only regulator to recently award a whistleblower. Earlier this month, the US Commodity Futures Trading Commission (CFTC) announced it was awarding an individual $2M for a successful action that the regulator brought as a result of information provided by this person, as well as for a related action successfully brought by a different regulator because of the same invaluable tip.
Under the CFTC Whistleblower Program, individuals who step forward providing unique and timely information resulting in a successful enforcement action also may be able to receive 10-30% of what is recovered. The program allows the CFTC to pay awards on related resulting actions that were brought by other federal regulators, as long as these actions meet certain criteria.
The whistleblower awards come out of the CFTC Customer Protection Plan. To date, the regulator has issued over $85M in whistleblower awards for over $675M in sanctions that were imposed. Throughout the years, Shepherd Smith Edwards and Kantas, LLP (SSEK Law Firm) has helped investors in recouping their fraud losses. and we can help you explore your legal options.