On April 16, 2020, the US Securities and Exchange Commission announced a whistleblower award for more than $27 million that, according to the SEC, is the largest award announced this year and the sixth largest award since the inception of the program. The SEC has now awarded more than $400 million to whistleblowers.
The Claims Review Staff determined that the amount of this specific award was appropriate, pursuant to the criteria in Rule 21F-6 of the Securities Exchange Act of 1934, because the claimant’s assistance allowed the SEC to uncover misconduct occurring, in part, overseas; the assistance was ongoing and substantially advanced the investigation while saving the SEC significant time and resources; and the assistance helped bring an enforcement action that addressed a very specific form of misconduct that the SEC needed to address (the type of misconduct was redacted in the public Order). The SEC also emphasized that although it usually reduces the percentage of an award when there is an unreasonable delay in reporting misconduct to the SEC, under the facts and circumstances of the current case, no reduction was warranted because of the strength of the “positive factors” of the whistleblower’s reporting, coupled with the fact that the whistleblower repeatedly and strenuously raised concerns about the questionable conduct inside the organization.