Who Can Receive a Reward as a Whistleblower?

Any individual or group of individuals (with few exclusions), regardless of citizenship, can be an SEC whistleblower. To be eligible for a monetary award, whistleblowers must voluntarily provide original information about a possible violation of the federal securities laws to the SEC. Companies and organizations cannot be SEC whistleblowers.

Importantly, a whistleblower doesn’t have to be employed by the entity they are blowing the whistle on.  An SEC whistleblower may report violations of the federal securities laws that have occurred, are ongoing, or are about to occur. The reported misconduct may occur anywhere in the world. In most cases, SEC enforcement actions involve manipulative and deceptive practices associated with the purchase or sale of a security. Beyond stocks and bonds, the federal securities laws have interpreted “security” broadly to include investment contracts, notes and other non-traditional investments. Some examples of the types of conduct that SEC whistleblowers report include:

  • Ponzi schemes or Pyramid schemes
  • Theft or misappropriation of funds or securities
  • Manipulation of a security’s price or volume
  • Insider trading
  • Fraudulent or unregistered securities offering
  • False or misleading statements about a company (including those made in SEC reports or financial statements
  • Abusive naked short selling
  • Bribery of, or improper payments to, foreign officials in violation of the Foreign Corrupt Practices Act

While a whistleblower need not work at the company he or she is blowing the whistle on, company insiders are important whistleblowers. Current or former employees are often best positioned to witness wrongdoing and may hold the key to helping SEC investigators unlock intricate fraudulent schemes and investigate the full extent of violations.

If you choose to blow the whistle on violations of the federal securities laws, the attorneys at Bernstein Liebhard will help you navigate the SEC Whistleblower Program to ensure that you comply with the program’s requirements and avail yourself of the program’s protections. Bernstein Liebhard LLP has litigated some of the largest securities fraud class actions since the passage of the Private Securities Litigation Reform Act of 1995 and our SEC Whistleblower attorneys have substantial experience fighting securities fraud.  We are dedicated to providing experienced, dedicated, and aggressive representation for whistleblowers looking to report violations of the federal securities laws to the SEC. Contact Michael S. Bigin or Laurence J. Hasson for more information.