In retrospect, 2014 has to be considered a success for the whistleblower program run by the United States Securities and Exchange Commission (SEC). This year, whistleblowers who earned awards through the SEC earned more money than in all previous years of the program’s existence combined, with one whistleblower who reported major fraud within a company earning a record-setting $30 million award.
According to an official report that the SEC provided to congress in late November, the agency issued a total of nine monetary awards to whistleblowers who offered original information about various violations of federal securities laws. The whistleblower program originally came into being in 2011, and between 2011 and 2013 the agency had only handed out four awards total.
2014 also saw the agency’s first-ever enforcement action related to retaliation this year. The SEC ordered Paradigm Capital Management to pay a penalty of $2.2 million for punishing the head trader of the firm after he went through the process to report illegal transactions made by the firm.
It was clearly a banner year for the Whistleblower Protection Program, which is still relatively young as far as legislation goes in the United States. The program allows for whistleblowers to potentially collect between 10 and 30 percent of the funds recovered in a case if their information leads to a successful enforcement action that yields a minimum of $1 million. In cases involving multiple whistleblowers, the government may choose to divide the money earned from sanctions among the whistleblowers that helped to provide the information.
If you are interested in learning more about the SEC’s whistleblower program and if you may have an opportunity to submit a claim, consult the respected Dallas whistleblower attorneys at Whistleblower Law for Managers today.