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SEC issues largest-ever whistleblower award of nearly $279 million

On Behalf of | May 15, 2023 | Financial News

The Securities and Exchange Commission has announced the largest-ever award in the history of its whistleblower program.

The SEC said it had awarded nearly $279 million to a whistleblower who came forward with information and assistance that led to a successful enforcement action. That sum more than doubles the previous record award of $114 million that was issued in October 2020.

“The whistleblower’s sustained assistance including multiple interviews and written submissions was critical to the success of these actions,” said Creola Kelly, Chief of the SEC’s Office of the Whistleblower, who did not disclose specifics regarding the case or the whistleblower.  Kelly added that the information provided by the whistleblower did not prompt the commission to launch its investigation, but it did expand the scope of the misconduct that was charged.

“The size of today’s award – the highest in our program’s history – not only incentivizes whistleblowers to come forward with accurate information about potential securities law violations, but also reflects the tremendous success of our whistleblower program,” said Gurbir S. Grewal, Director of the SEC’s Division of Enforcement.

Grewal added that the program directly benefits investors because whistleblowers have aided enforcement actions resulting in the return of over $4 billion in ill-gotten gains and interest.

Created by Congress under the Dodd-Frank Act of 2010, the whistleblower program is financed entirely through monetary sanctions paid to the SEC by securities law violators. Individuals who voluntarily provide the SEC with original, timely, and credible information that leads to a successful enforcement action may be eligible for a whistleblower award. The confidentiality of all whistleblowers is protected by the SEC, and no information is disclosed that could reveal their identity. Whistleblower awards can range from 10 to 30 percent of the money collected when the monetary sanctions exceed $1 million.

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