Nearly $40 Million Awarded to a Whistleblower By the SEC
On July 17th, 2024, the Securities and Exchange Commission (SEC) announced that nearly $40 million in financial compensation had been awarded to a whistleblower. According to the agency, the individual provided new information and cooperated with investigators—leading to successful enforcement action. Here, our Miami SEC whistleblower lawyer discusses the award in more detail.
Whistleblower Award Issue to Person Who Came Forward, Helped Stop Securities Violation
As confirmed by the SEC, a whistleblower award was issued to an individual who voluntarily came forward and provided original information that was not known to the agency. Based on the information and the individual’s subsequent cooperation, the SEC was able to take successful enforcement action. The SEC issued a whistleblower award of approximately $37 million.
The Three Key Factors that Affect the Value of a Whistleblower Award
How does the SEC determine the value of a whistleblower award? The short answer is that the amount is broadly set by federal law, but the agency does retain some discretion in deciding exactly how much whistleblower compensation should be awarded to a particular claimant. Here are the three main factors that affect the amount of whistleblower compensation from the SEC:
- Amount of Sanctions in Enforcement Action: The value of a whistleblower award is heavily dependent on the total monetary sanctions collected as a result of the enforcement action. By law, the SEC is required to award a whistleblower who meets the program’s requirements an award valued between 10 percent and 30 percent of the successful enforcement action. The money does not come from investors. There is a specialized fund.
- Importance of Information Provided: The quality and significance of the information provided by the whistleblower also play a crucial role in determining the award’s value. Information that directly leads to a successful enforcement action or that significantly contributes to the scope and effectiveness of the investigation is highly valued.
- Extent of the Cooperation By the Whistleblower: The level of cooperation offered by the whistleblower throughout the investigation process is another critical factor. This includes the willingness to provide ongoing assistance, the ability to offer additional documents or evidence, and the overall helpfulness in supporting the enforcement action. Whistleblowers who engage proactively and constructively with investigators enhance their chances of securing a more substantial award.
SEC whistleblower claims are complicated. To get an award at all, a whistleblower must be all of the requirements set forth by federal law. An experienced Miami, FL SEC whistleblower lawyer can help you navigate the program’s requirements.
Set Up a Confidential Consultation With Our Florida SEC Whistleblower Attorney Today
At Carlson & Associates, P.A., we are skilled and experienced advocates for SEC whistleblowers. If you are preparing to make a confidential disclosure of a securities law violation to the SEC, we are here to help. Contact us today to arrange a review of your case. With a legal office in Miami, our firm advocates for the rights of whistleblowers in Florida.
Source:
sec.gov/newsroom/press-releases/2024-85