Case Studies

Since the inception of the Securities and Exchange Commission's whistleblower program in August 2011, the Commission has granted eight awards to whistleblowers who provided original information that allowed the Commission to quickly investigate securities law violations and protect investors from further financial injury.  

A Selection of Whistleblower Awards:

On August 21, 2012, the Commission granted its first award to a whistleblower who provided documents and significant information to the SEC that ultimately led to the filing of an emergency action in federal court to prevent the defendants from further dissipating investor funds. The whistleblower's tip led to court order sanctions totaling more than $1 million dollars. The whistleblower in this case received an award of 30%, the maximum percentage payout allowed under the law.   

On October 1, 2013, the Commission made its largest award to date, awarding over $14 million to a whistleblower whose information led to enforcement action that recovered substantial investor funds. This recovery was not only notable for its amount, but also because enforcement was taken by the Commission just six months after the whistleblower submitted the tip.

On June 16, 2014, the Commission announced that for the first time in program history, they exercised authority under the Dodd-Frank Act to bring enforcement action against a company for retaliation against a whistleblower. The former head trader at Paradigm filed a whistleblower complaint with the SEC in March 2012 accusing Paradigm of engaging in prohibited principal transactions. Once aware that the head trader had filed a complaint with the SEC, Paradigm demoted the head trader, stripped him of all supervisory responsibilities, and otherwise sought to marginalize him. 

On September 22, 2014 the Commission announced its largest award to date, a $30 million dollar award to a whistleblower who provided key information that led to a successful enforcement action. The latest award was the fourth to a whistleblower living in a foreign country and the fourteenth award in the programs history.   

The SEC posts Notices of Covered Action where a final judgment or order results in monetary sanctions exceeding $1 million. The inclusion of a Notice means only that an order was entered with monetary sanctions exceeding $1 million. Posting a Notice for a particular case does not necessarily mean that the SEC has made a determinations that a whistleblower tip, complaint or referral led to the Commission opening an investigation or filing an action with respect to the case, or that an award to a whistleblower will be paid in connection with the case..