SEC Awards $450,000 to Whistle-blower

Washington, DC (STL.News) The Securities and Exchange Commission today announced an award of $450,000 to a whistle-blower whose significant information helped focus an ongoing investigation on the violations that were ultimately charged.

The whistle-blower, who had compliance-related responsibilities, is eligible for an award because the whistle-blower reported concerns about the relevant conduct internally within the company and then waited 120 days before reporting to the SEC.  This is the SEC’s third whistle-blower award to an individual who had compliance or internal audit responsibilities.

“To ensure that important information about securities laws violations is reported to the SEC when appropriate corrective action is not taken by the company, the rules permit awards to compliance professionals in certain limited circumstances,” said Jane Norberg, Chief of the SEC’s Office of the Whistle-blower.  “Here, the whistle-blower made reasonable efforts to work within the company’s compliance structure, suffered unique hardships as a result, and reported to the Commission after the requisite time period had passed, ultimately providing meaningful assistance to the Commission’s investigation and subsequent enforcement action.”

The SEC has awarded over $396 million to 77 individuals since issuing its first award in 2012.  All payments are 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.  No money has been taken or withheld from harmed investors to pay whistle-blower awards.  Whistle-blowers 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.  Whistle-blower awards can range from 10 percent 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 whistle-blowers and does not disclose information that could reveal a whistle-blower’s identity.