Printed from BusinessInsurance.com

SEC pays out third-highest whistleblower award of $3 million

Posted On: Jul. 20, 2015 12:00 AM CST

The U.S. Securities and Exchange Commission has awarded more than $3 million to a whistleblower, the third-highest award to date under its 4-year-old whistleblower program.

The agency said in a statement Friday that the $3 million was awarded to a company insider who helped “crack a complex fraud.” The SEC does not identify its whistleblowers by name.

In rank, the $3 million award follows one of more than $30 million in 2014 and one of more than $14 million in 2013.

A total of 18 whistleblowers have been awarded more than $50 million since the program's inception in 2011. Payments are made out of an investor protection fund established by Congress that is financed through monetary sanctions paid to the SEC by securities law violators.

In connection with the $3 million award, the SEC said the whistleblower's “specific and detailed information comprehensively laid out the fraudulent scheme which otherwise would have been very difficult for investigator to detect,” and that the initial tip also led to related actions that increased the award.

“Insiders may hold the key to helping our investigators unlock intricate fraudulent schemes,” Andrew Ceresney, director of the SEC's Division of Enforcement, said in a statement. “By providing significant financial incentives for people to come forward, the SEC's whistleblower program continues to be profoundly effective in helping us protect investors and hold wrongdoers accountable.”