Compliance and audit personnel typically aren’t eligible for whistleblower awards from the U.S Securities and Exchange Commission (SEC) — but there are exceptions.
The SEC has awarded more than US$300,000 to a tipster who discovered misconduct as part of fulfilling their audit-related responsibilities and provided the agency with information and assistance in a case that resulted in enforcement action.
“Although individuals with audit or compliance responsibilities are generally not eligible for awards, a whistleblower who reasonably believes that an entity is engaging in conduct that would impede the investigation falls within one of the exceptions to that rule,” the SEC said in a release.
In this case, the prospective whistleblower “had a reasonable basis to believe” that the target of the SEC’s investigation would hinder its work.
“This award is an example of the important role that audit and compliance professionals can play in assisting the commission’s enforcement efforts, especially when the entity is attempting to thwart an investigation,” said Jane Norberg, chief of the SEC’s Office of the Whistleblower.
“The whistleblower attempted to remedy the conduct and provided exceptional assistance to the enforcement staff,” she said.
The SEC has now paid 124 whistleblower awards totalling US$731 million. This was the fourth time the regulator paid a whistleblower with internal audit or compliance responsibilities.