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January 21, 2016 at 11:24 AM
Among recent enforcement actions by the Securities and Exchange Commission were a $2 million fine against Ocwen Financial Corp. and a $700,000 award to a whistleblower whose assistance resulted in a successful enforcement action.
Also, the Financial Industry Regulatory Authority censured and fined a firm for sales of unsuitable investments to customers.
SEC Awards Whistleblower More than $700,000
A whistleblower, a company outsider who conducted a detailed analysis that led to a successful SEC enforcement action, was awarded more than $700,000 by the SEC.
“The voluntary submission of high-quality analysis by industry experts can be every bit as valuable as first-hand knowledge of wrongdoing by company insiders,” Andrew Ceresney, director of the SEC’s enforcement division, said in a statement.
The SEC’s whistleblower program has paid more than $55 million to 23 whistleblowers since the program’s inception in 2011; awards for unique and useful information that leads to a successful enforcement action may be eligible for an award that can range from 10% to 30% of the money collected when the monetary sanctions exceed $1 million.
All payments are made out of an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators; no money is taken or withheld from harmed investors to pay whistleblower awards.
“This award demonstrates the Commission’s commitment to awarding those who voluntarily provide independent analysis as well as independent knowledge of securities law violations to the agency,” Sean McKessy, chief of the SEC’s Office of the Whistleblower, said in a statement. “We welcome analytical information from those with in-depth market knowledge and experience that may provide the springboard for an investigation.”
Ocwen Settles with SEC for $2 Million
Ocwen Financial Corp. has agreed to pay a $2 million penalty to settle SEC charges that it misstated financial results by using a flawed, undisclosed methodology to value complex mortgage assets.
According to the agency, its investigation found that the company inaccurately disclosed to investors that it independently valued these assets when that was not how the assets were valued.
