On August 26, 2024, the Securities and Exchange Commission announced that $24 million was being awarded to two whistleblowers who provided original information that led to a successful SEC enforcement action and a related action brought by an unnamed agency.
According to the SEC’s order, Claimant 1 received $4 million for providing information that prompted the SEC to open an investigation, but he/she had limited knowledge of the misconduct and was unable to provide much assistance beyond the initial tip. The SEC also reduced the award because Claimant 1 “unreasonably delayed reporting” the conduct to the SEC, as he/she reported his/her concerns to a supervisor, and then did not report to the SEC for two years.
Claimant 2, who provided information after Claimant 1, was awarded $20 million because his/her information was more detailed, saving SEC staff significant time and resources in investigating the potential violations. Over the course of “numerous” meetings with the SEC, Claimant 2 provided information about key witnesses and their roles in various schemes. The SEC further credited Claimant 2 because the information provided “would have been difficult to obtain as it related to conduct occurring abroad.” Claimant 2 also received credit for reporting the potential misconduct internally, which prompted the Company to conduct an internal investigation.