Can I receive an award?

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The Commission is authorized by Congress to provide monetary awards to eligible individuals who come forward with high-quality original information that leads to a Commission enforcement action in which over $1 million in sanctions is ordered. The range for awards is between 10% and 30% of the money collected. Whistleblowers will receive a reward of 10 percent to 30 percent based on the amount the SEC and CFTC collects as a result of the whistleblower’s information, if more than $1 million is collected. Once the SEC recovers more than $1 million, recoveries in related cases by other agencies also are counted toward the whistleblower award. Certain factors will be considered in determining the whistleblower’s reward:

  • The significance of the information provided by the whistleblower.
  • The assistance provided by the whistleblower and the whistleblower’s attorney.
  • The “programmatic interest” of the SEC “in deterring violations of the securities law.”

Government employees and employees of self-regulatory organizations are not eligible for rewards, nor is anyone criminally convicted for the violation that she reports. Moreover, both the SEC and CFTC whistleblower program rules prohibit officers, directors, and those involved in audit and compliance functions from receiving an award, unless the individual has reported internally and the company has failed to take action within 120 days, or if the individual reasonably believes that investors will be substantially injured or that the entity is engaging in conduct that will obstruct the Commission’s investigation. Rewards also cannot be paid for information derived from public disclosures, unless the person was the source of the information.

For these and other reasons, it is important to consult with an experience attorney who is familiar with the SEC Whistleblower Program before filing a whistleblower claim with the SEC.

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