As insider information is leading the US Securities and Exchange Commission (SEC) towards busting more irregularities in companies, it has recently handed out more than $9.2 million to an unnamed whistleblower.
Announced on Tuesday, the tip-off from the insider led the financial regulator to bust an ongoing financial fraud, which concluded with the return of ‘a large amount of money’ to the victims.
Additionally, the regulator elaborated that the information provided by the tipster led to a non-prosecution agreement (NPA) or deferred prosecution agreement (DPA) by the justice department. Additionally, the recent monetary award was the first under the new rules of the SEC’s whistleblower program that came into effect last December.
Moreover, the announcement highlighted that the same whistleblower received an additional monetary reward for the same information previously from the financial regulator.
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Monetary Reward Encouriging Tipsters to Come Out
The SEC in recent years took the approach of rewarding tipsters heavily for the exchange of any valuable information on financial crimes. The approach turned out to be a massive success as the agency awarded more than $750 million to 136 individuals since 2012, the initiation of the program.
The SEC generally distributed around 10 to 30 percent of the confiscated proceeds to the whistleblowers for monetary sanctions above $1 million. Though the latest reward looks significant, it is nowhere near the SEC’s record $50 million in bounty to a single tipster.
Commenting on the massive reward, Jane Norberg, Chief of the SEC’s Office of the Whistleblower, said: “This award reflects the Commission’s determination that a whistleblower’s eligibility for an award should not depend on the procedural vehicle a federal agency selects to resolve an enforcement matter. Deserving whistleblowers, like today’s awardee, will be rewarded regardless of the path used to successfully conclude the matter.”