SEC Awards $2 Million to Whistleblower
The SEC awarded $2 million to a whistleblower for providing information that led to a successful enforcement action.
According to the SEC, the whistleblower provided extensive assistance to the SEC's investigation by (i) supplying information that would have been difficult for SEC staff to obtain otherwise, (ii) reporting the information in a timely manner despite certain obstacles and (iii) assisting SEC staff during their investigation in the face of implied threats to the whistleblower.
Since issuing its first whistleblower award in 2012, the SEC has awarded over $398 million to 78 individuals.
Commentary
This is the fifth whistleblower award payout in the last 12 days and the eighth of 2020, which already matches the total whistleblower awards from all of 2019. While the amounts in 2020 have been less substantial than last year's amounts, the whistleblower program is still alive and well in the post-Digital Realty world.
In what has been a common theme in recent awards, the SEC found that the whistleblower suffered hardships as a result of the internal report. Because of the confidentiality rules surrounding whistleblowers, it is unknown whether this was retaliatory action taken by the company or its employees. Either way, it will be interesting to see if the SEC decides to pursue a separate action against any of these perpetrators, if only to serve as a reminder to companies that the SEC has this ability and that anti-retaliation efforts are critical.