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SEC Hands Out $5 Million Award to Whistleblower

The U.S. Securities and Exchange Commission (SEC) announced in mid-May that it will award a whistleblower $5 million to $6 million for the person’s assistance in a recent investigation. The whistleblower was a former company insider who provided a detailed, unique tip that led the SEC to uncover significant securities violations it never would have found without the whistleblower’s help.

No further information was revealed about the whistleblower or the particular act that led to the enforcement action. Federal law dictates the SEC not reveal any information about a whistleblower that could compromise his or her identity.

Third-largest award ever

This award marked the third-highest award the SEC has ever provided to a whistleblower. The record high remains at $30 million, which was awarded in September 2014 to a whistleblower who provided information that led to the federal agency busting up a major fraud ring. The second-highest award was a $14 million payout in October 2013.

With two more whistleblowers receiving awards just days after this announcement was made, the SEC whistleblower program is now up to more than $68 million to 31 different whistleblowers. Whistleblowers have the opportunity to receive anywhere from 10 to 30 percent of the money collected when enforcement actions result in sanctions of more than $1 million.

The money paid out in these whistleblower awards comes from an investor protection fund that Congress owns. It is financed through sanctions that anyone who violates securities laws must pay to the SEC.

Whistleblowers now enjoy more protections than ever before. To make sure your business or organization responds promptly and effectively to these complaints, consult a dedicated attorney with Whistleblower Law for Managers in Dallas.

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  • "Steve Kardell was terrific in representing me in some very adversarial discussions with Citigroup and also later represented me in my testimony before the Financial Crisis Inquiry Commission."  -Richard Bowen, Citigroup Whistleblower

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  • "Reaching out to Steve Kardell was the best decision I made. His ability to provide immediate insight and direction was very powerful, and a huge relief during a very stressful time period. For anyone struggling with a whistleblower situation, I would highly recommend at least speaking with Steve. After a 10 minute call with him, I had a better understanding of what I was dealing with. Even better, he gave me some immediate hope. In the end Steve did a better job than I thought was possible. Steve was able to get in contact with people in my organization, that I didn’t have access to. Because of his years of experience, he already has contacts in many organizations in Dallas. The entire situation was handled peacefully. I was impressed by his ability to “keep the peace”–rather than creating a battle with the organization. The reason I didn’t reach out to a lawyer initially, was because I thought it would mean an immediate end to any hope of a positive relationship with the company. Steve was able to address my concerns, and in the end I was able to continue to work for them."  -KS

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