SEC whistleblowers exceed $ 1 billion in aggregate as securities watchdog announces near record price


U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler testifies before a Senate Banking, Housing, and Urban Affairs Committee watch hearing on the SEC on Capitol Hill in Washington, September 14, 2021 .

Evelyne Hockstein | Swimming pool | Reuters

The Securities and Exchange Commission said on Wednesday that the total amount of payments it made to whistleblowers exceeded $ 1 billion after the financial watchdog awarded its second highest award to a person for reporting wrongdoing .

The SEC said one person this week received a combined $ 110 million for information and assistance that led to successful enforcement actions by the SEC and other entities.

About $ 40 million of that payment was related to an SEC case, with the remainder coming from related actions by another unidentified agency.

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That total reward was close to the record $ 114 million awarded last October by the regulator, which began paying whistleblower bonuses in 2012.

Another person recently received a whistleblower reward of $ 4 million, the SEC said, bringing the total of those payments this year to over $ 500 million.

Earlier this year, the third largest whistleblower award of $ 50 million was awarded.

The SEC by law does not disclose the identity of whistleblowers or information that could lead to their identity being revealed.

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Since the program began, the SEC has paid 207 whistleblowers more than $ 1.07 billion, according to the agency, whose mission is to protect investors and maintain fair and efficient markets.

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These payments, which range in value from 10% to 30% of SEC-imposed monetary penalties that exceed $ 1 million, are funded by the penalties, not by the investors who have been harmed.

The SEC said information provided by whistleblowers since the start of the program has resulted in more than $ 4.8 billion in financial recourse.

“We have just taken an important milestone,” SEC Chairman Gary Gensler said in a tweeted video announcing the billion dollar payment threshold had been breached.

“Each of the whistleblowers has done an important service,” Gensler said. “When I see the commission’s enforcement action every week, it reminds me of how the whistleblower program helps us be better cops on the ground, execute our mission, and protect investors from misconduct.”

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Gensler on this video encouraged potential whistleblowers to visit the SEC website:

Earlier Wednesday, in an interview with TUSEN’s “Squawk on the Street,” Gensler said the SEC faces a series of tough enforcement issues, even though it has up to 5% fewer members. staff than five years ago.

“We have an IPO boom, we have a SPAC boom, we have cryptocurrencies to manage,” Gensler said. “I would at least like to come back [staff level] where we were in 2016 and I think we should probably be 5% or 10% bigger than that. “

Gensler told the Senate on Tuesday that he needed “a lot more people” to help him manage thousands of new digital assets, such as cryptocurrencies.



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