The United States’ Securities and Exchange Commission (SEC) has awarded nearly $5 million to a whistleblower, who provided critical information and assistance that led to the success of a covered action.
A statement by the investment regulatory commission indicated that the whistleblower’s information helped it to more quickly and efficiently to bring an action that returned millions of dollars to harmed investors.
Commenting on the recovery, Chief of the SEC’s Office of the Whistleblower, Creola Kelly, said: “Today’s award underscores the vital role that whistleblowers play in the SEC’s enforcement program and the protection of investors.
“Because of the information and assistance provided by the whistleblower, a significant amount of money was returned to victims of the securities laws violations”, Kelly added.
So far, the SEC has awarded approximately $1.2 billion to 236 individuals since issuing its first award in 2012 and all the payments were 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 commission stated that no money had been taken or withheld from harmed investors to pay whistleblower awards.
Based on the enabling Dodd-Frank Act, 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 Act, the SEC protects the confidentiality of whistleblowers and does not disclose any information that could reveal a whistleblower’s identity.
