Two proposed changes to the U.S. Securities and Exchange Commission’s (SEC) whistleblower program are intended to keep the tips rolling in.
“These amendments, if adopted, would help ensure that whistleblowers are both incentivized and appropriately rewarded for their efforts in reporting potential violations of the law to the commission,” said SEC chair Gary Gensler in a release.
One of the changes would allow the commission to pay whistleblower awards for actions brought by other entities, such as other federal agencies that have their own, less lucrative whistleblower program.
The change is intended to ensure that a whistleblower “is not disadvantaged by another whistleblower program that would not give them as high an award as the SEC would offer,” Gensler said.
The other revision would allow the commission to consider the dollar value of an award — which is typically calculated as between 10% and 30% of sanctions — and potentially increase (but not decrease) the size of an award.
“This would give whistleblowers additional comfort knowing that the SEC could consider the dollar amount of the award only in such cases,” Gensler noted.
The proposals are out for comment for 60 days.
Under the whistleblower program, which issued its first award in 2012, the SEC has paid out approximately US$1.2 billion to 245 tipsters.