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SEC Doles Out $22M Whistleblower Award

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The Securities and Exchange Commission said Tuesday that it has awarded more than $22 million to a whistleblower whose detailed tip and extensive assistance helped the agency halt a well-hidden fraud at the company where the whistleblower worked.

The $22 million-plus award is the second-largest total the SEC has awarded a whistleblower. The largest, $30 million, was awarded in 2014.

Jane Norberg, acting chief of the SEC’s Office of the Whistleblower, said in announcing the award that “company employees are in unique positions behind the scenes to unravel complex or deeply buried wrongdoing. Without this whistleblower’s courage, information and assistance, it would have been extremely difficult for law enforcement to discover this securities fraud on its own.”

Sean McKessy, chief of Office of the Whistleblower, left the agency in July.

The agency awarded $17 million to a Labaton Sucharow whistleblower client in June who the law firms says “provided high-quality information that led to sanctions against a major player in the financial markets.”

The SEC’s whistleblower program, launched in 2011, has surpassed $100 million in total money awarded.

More than $107 million has been awarded to 33 whistleblowers who became eligible for an award by voluntarily providing the SEC with original and useful information that led to a successful enforcement action. Whistleblower awards can range from 10% to 30% of the money collected when the monetary sanctions exceed $1 million.

Since being created, the SEC’s Whistleblower Office has received more than 14,000 whistleblower tips from individuals in all 50 states and the District of Columbia and 95 foreign countries.

Tips from whistleblowers have increased from 3,001 in fiscal year 2012 – the first full fiscal year that the Whistleblower Office was in operation – to nearly 4,000 last year, an approximately 30% increase, the SEC says.

By law, the SEC protects the confidentiality of whistleblowers and does not disclose information that might directly or indirectly reveal a whistleblower’s identity.

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