The U.S. Securities and Exchange Commission (SEC) has announced that a whistleblower has received a multi-million dollar payout for information leading to a major enforcement action.
The tipster will receive more than US$20 million after providing the SEC with information that enabled it to thwart misconduct and prevent victims from losing money. This award is the third largest since the SEC began paying for information that produces significant enforcement cases.
Although the SEC does not provide details on these to preserve the whistleblower’s anonymity, it notes that the tipster in this case enabled the commission to bring an enforcement action before most of the money could be lost.
“This whistleblower alerted us with a valuable tip that led to a near total recovery of investor funds,” says Jane Norberg, chief of the SEC’s Office of the Whistleblower, in a statement. “Sizeable awards like this one should encourage whistleblowers everywhere that there are real financial incentives to promptly reporting potential securities law violations to the SEC.”
Thus far, more than US$130 million has now been awarded to whistleblowers under the SEC’s program.
Earlier this year, the Ontario Securities Commission (OSC) launched Canada’s first program designed to pay whistleblowers for information. The OSC has said that its program has received several dozen tips, but it has yet to pay an award.