The United States Securities and Exchange Commission (SEC) has awarded $5 million to another four whistleblowers combined for tipping off and helping the regulator in financial fraud investigations.
As detailed in Wednesday’s announcement, one of the four tipsters received nearly $2.9 million for alerting the watchdog of ‘hard-to-detect’ violations with critical information and supporting evidence while another former company insider was awarded over $1.7 million for assistance in an ongoing investigation.
Another $400,000 was jointly awarded to the other two whistleblowers for tipping it off and giving continuing assistance during the SEC investigation.
“The awards issued in the last month demonstrate the variety and breadth of tips received from whistleblowers,” Jane Norberg, chief of the SEC’s office of the whistleblower, said. “Award recipients in the last month include company outsiders who provided independent analysis, international whistleblowers who shone a light on hard to detect overseas conduct, and company insiders who provided critical information and substantial assistance that helped the Commission better protect investors and the marketplace.”
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Encouraging Insiders to Blow the Whistle
With this, the regulator highlighted that it has set a record in awarding whistleblowers in the last fiscal year. As many as 39 tipsters were awarded monetary compensation for their insider information now amounting to the sum of $175 million for 2020.
The SEC started compensating whistleblowers in 2012 and since then awarded almost $562 million to 106 individuals. The whistleblower’s compensation can vary between 10 percent to 30 percent of the recovered funds.
Earlier in June, Finance Magnates reported that the SEC awarded a hefty $50 million to a tipster for blowing the whistle on misconduct, which produced a successful enforcement action and returned a significant amount of money to harmed investors.
“Today marks the end of a record-setting year for the whistleblower program,” Stephanie Avakian, director of the division of enforcement, added. “We’ve made significant strides to further streamline and accelerate the evaluation of claims under the rules, substantially increasing the rate at which whistleblower claims are evaluated and awards are issued.”