SEC Explains What Past Whistleblower Award Winners Had In Common

SEC whistleblowers and SEC whistleblower lawyers typically want to stop frauds or securities violations from occurring and, in the process, hopefully join the ranks of SEC whistleblower award winners.

In 2019, the U.S. Securities and Exchange Commission (“SEC”) provided some insights that might help you improve your chances.

The SEC’s 2019 Annual Report To Congress

whistleblower award winners

The SEC’s 2019 Report To Congress

The Dodd-Frank Act requires the U.S Securities and Exchange Commission (“SEC”) to provide a report about the SEC whistleblower program to the U.S. Congress each year (the “Annual Report”).   For general information about the SEC’s Annual Report and what information it is required to contain, see here.

The 2019 Annual Report began with a recitation of recent large whistleblower award winners.  The Chief of the SEC’s Office of the Whistleblower explained what these large awards mean to the SEC:  “these large awards reflect the significance of the information that whistleblowers are providing to the Commission and are testaments to the whistleblower program’s success”.  (2019 Annual Report, p. 1.)

According to the Annual Report, by the end of fiscal year 2019, there had been 67 whistleblower award winners.  As of the date of the Annual Report, together those whistleblower award winners had received a combined total of approximately $387 million in SEC whistleblower rewards.  (Annual Report, p. 17.)

The 2019 Annual Report Had An Entire Section About Past SEC Whistleblower Award Winners

The 2019 Annual Report contained an entire section titled “Profiles of Award Recipients”.  (2019 Annual Report, pp. 17-19.)

That section on past SEC whistleblower award winners was over two pages long.

whistleblower award winner

Similarities Among Past SEC Whistleblower Award Winners

According to the 2019 Annual Report, past SEC whistleblower award winners had the following in common (2019 Annual Report, pp. 17-18):

  • they provided specific information in their tips or complaints to the SEC.  This included submitting specific supporting documents, explaining to the SEC where it could obtain supporting documents, and/or identifying specific individuals who were involved in the securities frauds or violations.  [Note: by contrast, a week before the 2019 Annual Report was publicly released, a U.S. Court of Appeals upheld the SEC’s denial of a whistleblower award to someone who was “disjointed” and “difficult to follow”.  For a discussion of that case, see here]
  • nearly all of them gave additional assistance to the SEC after submitting their tips or complaints, such as by answering questions from the SEC or by providing testimony;
  • often the conduct that they reported was ongoing or relatively current when they filed their tips or complaints;
  • some of them identified specific financial transactions proving the frauds, or provided detailed explanations or analyses of the frauds;
  • more than two-thirds of them (approximately 69%) were current or former insiders at the companies they reported about, such as employees or officers of the companies; and
  • approximately one-third of the SEC whistleblower cases where awards were granted were brought against broker-dealers, investment advisers, or other registered market participants.

Additional Information

For additional information about the SEC’s 2019 Annual Report and what past whistleblower award winners had in common, click on the links below:

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