SEC announces awards to three whistleblowers totaling over $30 million

On September 28, 2020, the US Securities and Exchange Commission announced that over $1.8 million had been awarded to the 100th individual to receive a whistleblower reward under the Dodd–Frank Wall Street Reform and Consumer Protection Act.  The SEC noted that the individual, an “unaffiliated outsider of the company,” voluntarily provided original information that led to a successful enforcement action.  Moreover, after consideration of the administrative record, the SEC increased the amount of the award originally recommended by the Claims Review Staff, basing its decision on the significance of the information reported by the whistleblower, the expeditious manner in which he or she reported it, and the close nexus between the information provided by the whistleblower and the charges brought in the case.

On September 30, 2020, the SEC announced the award of nearly $30 million to two company insiders—over $22 million to one individual who alerted the SEC to potential violations after persistently reporting the issue up the chain of command within the company, and who provided the SEC with substantial ongoing assistance during the course of its investigation, and nearly $7 million to a second individual who provided additional information relating to the same matter.  According to the order, the second individual’s award was lower because, although he/she provided some new information, much of the information provided was duplicative of the other individual’s information, and he/she provided “more limited assistance” as compared to the other whistleblower.  The difference in the awards illustrates the significant monetary benefit of being the first to report violations to the SEC.

According to the SEC, the two whistleblowers voluntarily provided valuable information that led to enforcement actions against a company and several individuals and the return of millions of dollars to “harmed retail investors.”  

SEC press release (28 September 2020) | SEC order | 

SEC press release (30 September 2020) | SEC order | 

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