Despite being briefly involved in misconduct and delaying reporting for a couple of years, a tipster has been awarded US$20 million for providing information to the U.S. Securities and Exchange Commission (SEC) that helped the regulator bring a successful enforcement action.
The SEC paid the reward to a whistleblower who supplied “significant information” and ongoing assistance that helped its enforcement team investigate complex issues that ultimately resulted in a successful enforcement case.
“Today’s whistleblower played a crucial role in the ultimate success of the enforcement proceeding,” said Creola Kelly, chief of the SEC’s Office of the Whistleblower, in a release.
According to the SEC’s order, the whistleblower was “involved for a short period” in the conduct that resulted in enforcement action, and delayed reporting to the regulator for more than two years — factors that were considered in setting the amount of the award.
At the same time, the regulator denied other whistleblower claims in the case. Two of the rejected claimants challenged the SEC’s initial decision, but their appeals were denied.
One of the tipsters submitted information to the SEC just hours before the regulator filed its enforcement action, and it was determined that their information didn’t contribute to the case.
The tips provided by the other aspiring whistleblower “were not related to” the charges brought in the enforcement action, the SEC said in denying the other appeal.