SEC pays combined US$3 million to two whistleblowers

The U.S. Securities and Exchange Commission (SEC) is paying a combined US$3 million to a couple of whistleblowers that tipped the regulator to misconduct after reporting internally.

One tipster is getting more than US$2.2 million for providing information that the SEC said aided an investigation that resulted in enforcement action that returned “millions of dollars to harmed clients.”

The other award of almost US$700,000 went to a whistleblower who prompted the SEC to open an investigation by alerting SEC staff to a fraudulent reporting scheme.

“Both whistleblowers who received awards today raised their concerns internally and then timely reported those concerns to the commission,” said Jane Norberg, chief of the SEC’s Office of the Whistleblower.

“The return of millions of dollars to harmed clients in one matter, and the uncovering of a fraudulent scheme in the other matter, underscore the tremendous value that whistleblowers provide,” she said.

To date, the SEC has awarded approximately US$741 million to 136 whistleblowers since establishing its program. It pays financial rewards for enforcement tips in cases that result in monetary sanctions of at least US$1 million.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.