SEC Whistleblower Reward

There is no ceiling for an SEC whistleblower award.  Eligible whistleblowers are entitled to 10-30% of the monetary sanctions collected by the SEC in a successful enforcement action where the sanctions exceed $1 million.  The determination of the amount of the award is within the discretion of the SEC after considering the significance of the information provided by the whistleblower, the degree of assistance provided, and the “programmatic interest” of the SEC in deterring violations of the securities laws by rewarding whistleblowers.

SEC Whistleblower awards can be substantial.  Since the program was enacted, the SEC has awarded over $350 million to approximately 60 individual whistleblowers.  2018 was a record-breaking year for the SEC’s Whistleblower Program as the SEC ordered its largest whistleblower awards to date, awarding over $168 million in whistleblower awards to 13 individual whistleblowers.

In 2018 the SEC made two of its largest-ever whistleblower awards – a total combined $83 million award shared by three individual whistleblowers and an award of almost $54 million shared by two individual whistleblowers. The SEC noted that the recipients of these large awards provided significant information regarding serious violations that otherwise may have gone unnoticed and resulted in substantial enforcement actions. Commenting on the large SEC whistleblower awards, Jane Norberg, Chief of the SEC Whistleblower Office said:

“These awards show how critically important whistleblowers can be to the agency’s investigation and ability to bring a case to successful and efficient resolution.”

Whistleblowers have helped the SEC by alerting the agency to widespread, multi-year securities violations, and supplying information and documentation of such violations. Meritorious whistleblowers in FY 2018 were diverse and included, among others, a company outsider and whistleblowers residing or working overseas.

The large whistleblower awards ordered by the SEC are likely to continue.  In the SEC’s 2018 Report to Congress, Chief Norberg noted that she hoped that by rewarding whistleblowers, more individuals will come forward and report information of securities violations, which will in turn, help the SEC better protect investors and the marketplace.

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.