The Whistleblower Program was instituted in August of 2011 with the purpose of incentivizing people with inside, original information about potential securities law violations to come forward and share that information with the SEC. In order to incentivize whistleblowers, the Whistleblower Program may award whistleblowers an amount between 10% and 30% of the monetary sanctions collected. The Whistleblower Program recently released its 2015 annual report to Congress.
Some interesting things from the report are the following:
- “The commission has paid more than $54 million to 22 whistleblowers since the Commission’s new whistleblower rules went into effect in August 2011.”
- The number of tips received in 2015 represents a 30% increase from the amount received in 2012.
- The Whistleblower Program takes legal action against companies who attempt to create contracts and other means that discourage or prohibit employees from blowing the whistle.
- The largest award paid by the Whistleblower Program to date was more than $30 million.
- “Award percentages are based on the particular facts and circumstances of each case, and are not based on any hardset mathematical formula.”
- While whistleblower submissions have been received from every state and territory in the US, the states with the highest submissions are California, New York, Texas, Florida, and New Jersey (see map below).
Hopefully the Whistleblower Program is successful at helping uncover fraud early on. To learn more about what has happened during 2015 with the Whistleblower Program, read the full report to Congress at this link.