First SEC Whistleblower Paid $50,000 For Exposing Securities Fraud
On August 12, 2012, the Securities and Exchange Commission reported that it had recovered $150,000 thousand so far out of a Court order $1 million in sanctions against the perpetrators of securities fraud scheme. The Securities and Exchange Commission awarded the whistleblower, who wishes to remain anonymous, $50,000 for his/her contribution in providing the U.S. Government with provided documents and other significant information that allowed the SEC to investigate, move quickly, and prevent the fraud from ensnaring other victims. Any additional amount collected will increase the payments to the whistleblower.
SEC Chairman Mary L. Schapiro, stated that “[w]e’re seeing high-quality tips that are saving our investigators substantial time and resources” and that “[t]he whistleblower program is already becoming a success.” Robert Khuzami, Director of the SEC’s Division of Enforcement stated that “[h]ad this whistleblower not helped to uncover the full dimensions of the scheme, it is very likely that many more investors would have been victimized.” He also said that “[t]his whistleblower provided the exact kind of information and cooperation we were hoping the whistleblower program would attract.” The SEC stated they get about 8 tips per day.
The Dodd-Frank Act allows the SEC to reward individuals who offer high-quality original information that leads to an SEC enforcement action in which more than $1 million in sanctions is ordered. The whistleblower in this case was paid approximately 30% of the amount the government recovered. The SEC issues rewards between 10% and 30% of the money collected. “The law specifies that the SEC cannot disclose any information, including information the whistleblower provided to the SEC, which could reasonably be expected to directly or indirectly reveal a whistleblower’s identity.”
Young Law Group is a nationwide leader in whistleblower representation and has successfully represented numerous clients in some of the nation’s largest qui tam cases for over a decade. For a free confidential consultation, please call Eric L. Young, Esquire at (800) 590-4116 or complete our online form.