Two whistleblowers will be splitting an $875,000 SEC award for providing valuable information that helped the agency bring an enforcement action. The Dodd-Frank Act authorized the SEC’s whistleblower program. This program rewards individuals who provide high quality, original information that leads to an SEC enforcement action with sanctions that exceed $1 million. Whistleblowers can receive between 10 and 30 percent of the money that is recovered in a case.
Sean McKessy, chief of the SEC’s Office of the Whistleblower said “These whistleblowers provided original information and assistance that enabled us to investigate and bring a successful enforcement action in a complex area of the securities market… Whistleblowers who report their concerns to the SEC perform a great service to investors and help us combat fraud.”
The identity of whistleblowers is protected by law. The SEC cannot disclose any information that might directly or indirectly breach this confidentiality.
Whistleblowers can play a crucial role in helping the SEC identify fraud and securities law violations. Individuals who know about these violations can file a case and help the agency detect them sooner. According to the SEC website, this “allows the Commission to minimize the harm to investors, better preserve the integrity of the United States’ capital markets, and more swiftly hold accountable those responsible for unlawful conduct.”