Whistleblowing is Paying Off

The WSJ reported this week that the SEC has handed out it's second ever Dodd-Frank award for whistleblowing. the article says that the SEC expects more awards in the future. Here's a quote...

The agency Wednesday issued an order awarding three unnamed whistleblowers 5% each of the funds that it ultimately collects from its enforcement action against what it called “sham hedge fund” Locust Offshore Management LLC and Andrey C. Hicks, its chief executive. Hicks has pled guilty to criminal fraud charges and was sentenced to 40 months in prison.

Additionally, an article on AccountingWeb discusses the role whistleblowers have played in numerous recent fraud cases. The article describe a wide variety of cases where whistleblowers have led to valuable tips. The cases discussed include medicaid fraud, fraud in education including the Atlanta test score fraud and tips to the SEC on financial frauds. It also gives some statistics on how many whistleblower tips have come to the SEC as a result of the Dodd-Frank law.