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SEC Awards $16 Million To Two Whistleblowers

On August 9th, 2022, the Securities and Exchange Commission (SEC) announced two more whistleblower awards to individuals who provided critical information to help bring a stop to investment fraud. These two whistleblower awards are related to the same underlying matter. The SEC has now awarded more than $1.3 billion in financial compensation to 281 whistleblowers. Here, our Florida SEC whistleblower claims lawyer discusses the two awards issued by the agency.

Whistleblower Award #1: Approximately $13 Million to Person Who Prompted Investigation 

As with many securities fraud matters, the underlying investigation in the case was opened by the SEC only after a whistleblower came forward and provided critically important information that suggested potential violations. Additionally, the whistleblower also helps investigators better understand the matter—including connecting them with key witnesses.

The SEC determined that the whistleblower’s contributions were significant. Indeed, in issuing the award, the agency noted that the securities fraud would have been difficult to detect without the information from the whistleblower. An award of approximately $13 million was issued as whistleblower compensation.  

Whistleblower Award #2: Approximately $3 Million to Person Who Aided Investigation 

Another whistleblower was also granted an award in connection with this case. The second whistleblower came forward and voluntarily provided follow-up information that aided the SEC”s investigation. In regards to the second whistleblower, the SEC emphasized that:

  • The whistleblower was a valuable first-hand witness to the securities violations;
  • The whistleblower voluntarily provided extensive (relevant) documents; and
  • The whistleblower’s information gave investigators a far more clear picture of the fraud.

The SEC determined that the second whistleblower’s contributions helped the agency take enforcement action and bring a stop to securities fraud. An award of approximately $3 million was issued in whistleblower compensation.

How Does the SEC Determine the Value of Whistleblower Awards? 

SEC whistleblower compensation is highly case specific. The agency has some discretion in determining whether a whistleblower award is appropriate and, if so, how much financial compensation should be issued. To qualify for an SEC whistleblower, an individual must voluntarily disclose new information that helps the agency take enforcement action to stop securities fraud.

An SEC whistleblower award is calculated as a percentage of the successful enforcement action taken by the agency. The whistleblower can receive between ten percent and thirty percent of the value of the enforcement action as a whistleblower award. The SEC will determine the specific value within that range based on its view of how important the whistleblower’s contributions were to stopping the fraud.

 Consult With Our Miami SEC Whistleblower Claims Attorney Today

At ​Carlson & Associates, P.A., we help securities industry insiders and other knowledgeable parties  navigate the complexities of the SEC whistleblower program. Our law firm can help you make a confidential disclosure of sensitive information. If you have any questions about the SEC whistleblower program or SEC whistleblower awards, please contact our Miami law office to set up a fully private, no obligation initial consultation with a Florida SEC whistleblower attorney.

Source:

sec.gov/news/press-release/2022-139

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