SEC Receives More Than 3,000 Whistleblower Tips in FY2012 (with Lofchie Comment)

Over the past year, the SEC received more than 3,000 whistleblower tips from all 50 states and from 49 countries, according to the agency's 2012 Annual Report on the Dodd-Frank Whistleblower Program. The report notes, among other things:

• The SEC made its first award under the new program to a whistleblower who helped the SEC stop an ongoing multi-million dollar fraud. The whistleblower received an award of 30 percent of the amount collected in the SEC's enforcement action, which is the maximum percentage payout allowed by law.
• The SEC received 3,001 tips, complaints and referrals from whistleblowers from individuals in all 50 states, the District of Columbia, and the U.S. territory of Puerto Rico, as well as 49 countries outside of the United States.
• The most common complaints related to corporate disclosures and financials (18.2 percent), offering fraud (15.5 percent) and manipulation (15.2 percent).
• There were 143 enforcement judgments and orders issued during fiscal year 2012 that potentially qualify as eligible for whistleblower awards. The Office of the Whistleblower provided the public with notice of these actions because they involved sanctions exceeding the statutory threshold of more than $1 million.

Lofchie Comment: For those interested in a general discussion of whistleblowers, I am attaching one of our memos. If you shoot me an email, I can send you a few others. As for me, I still find the whole concept of the government paying whistleblowers who have done nothing to stop the improper conduct very morally ambiguous. Yes, I liked "Norma Rae", but what about "The Conformist"? That was another good movie about whistleblowers (but probably nobody cares because it had subtitles).

View report in full here (links externally to SEC website).See also: Press Release.