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SEC awards over $28 million to 7 whistleblowers for assistance in investigation

On Behalf of | Jan 2, 2024 | Securities and Compliance

The Securities and Exchange Commission has announced the latest awards in its whistleblower program, which provides monetary payments to eligible individuals who come forward with information about securities fraud or other wrongdoing.

The SEC said it awarded a combined $28 million to seven individuals who provided information and assistance that led to a successful SEC enforcement action.  The group included a single claimant and set of joint claimants who provided significant and detailed information early in the investigation that saved staff considerable time and resources. The second set of joint claimants provided new but more limited information later in the investigation, according to the SEC.

“These whistleblowers provided valuable information and substantial assistance that played a critical role in the SEC returning millions of dollars to harmed investors,” said Creola Kelly, Chief of the SEC’s Office of the Whistleblower.

Payments to whistleblowers are made out of an investor protection fund, established by Congress, which is financed entirely through monetary sanctions paid to the SEC by securities law violators. No money has been taken or withheld from harmed investors to pay whistleblower awards. Whistleblowers may be eligible for an award when they voluntarily provide the SEC with original, timely, and credible information that leads to a successful enforcement action. Whistleblower awards can range from 10 to 30 percent of the money collected when the monetary sanctions exceed $1 million.

As set forth in the Dodd-Frank Act, the SEC protects the confidentiality of whistleblowers and does not disclose any information that could reveal a whistleblower’s identity.

The attorneys at Lewitas Hyman include former senior attorneys at the SEC whose legal experience and industry knowledge make them uniquely qualified to provide counsel on securities regulatory, compliance and enforcement matters. Our attorneys fully understand the regulatory scrutiny financial professionals and their firms face from the various regulators that oversee the financial services industry. If your firm is facing an investigation from a regulatory agency, please contact Lewitas Hyman at (888) 655-6002 or through our online contact form.