September 17, 2021

SEC pays second highest whistleblower award ever, causing total awards to surpass $1 billion

On September 15, 2021, the US Securities and Exchange Commission announced two whistleblower awards — one for $110 million and another for $4 million — to two whistleblowers whose assistance led to a successful SEC enforcement action.  The $110 million award is the second-highest award in the program’s history, only surpassed by a $114 million award that was issued in October 2020.  These awards also mark a milestone for the SEC whistleblower program, bringing the total amount paid to whistleblowers since the program’s inception in 2012 to more than $1 billion. 

The $110 million award was issued to a whistleblower whose assistance not only led to a successful enforcement action for the SEC but also led to two related actions for an undisclosed agency.  The SEC determined that the amount awarded — approximately $40 million for assisting with the SEC matter and approximately $70 million for the related actions — was appropriate because the claimant provided significant independent analysis and information obtained from multiple sources that, when viewed collectively, provided a “strong inference” for investigators that securities laws had been violated.  The claimant, who according to the SEC Order suffered “personal and professional hardships” for cooperating, also provided investigators with a detailed proposed witness list and charts that saved the Commission significant time and resources.

The SEC determined that the second whistleblower’s $4 million award was appropriate because the claimant provided information to the SEC after the investigation was opened and significant progress had been made.  The SEC also held that the second whistleblower’s information and assistance, although helpful, was limited when compared to the first whistleblower’s contributions.

SEC Press Release | SEC Order