What is the SEC Whistleblower Program?
The SEC Whistleblower Program was created by Congress to incentivize those with knowledge about securities fraud to come forward and report the matter and present evidence to the SEC. Under the SEC program, eligible whistleblowers are entitled to an award of between 10 percent and 30 percent of the monetary sanctions collected in actions brought by the SEC and related actions brought by other regulatory and law enforcement authorities.
The SEC whistleblower law prohibits retaliation by employers against employees who provide the SEC with information about possible securities violations.
Who Is Eligible for an Award?
Any person who voluntarily provides the SEC with original information about a violation of federal securities laws that has occurred, is ongoing, or is about to occur, is eligible for a whistleblower award to be determined based on the amount of the money collected, and the quality of the information provided. You do not need to be a company insider or employee of the offending company to be an SEC whistleblower, nor do you need to be a United States citizen. For any award to be triggered, however, SEC action based on the whistleblower information must result in monetary sanctions in excess of $1 million.
More than one person may be eligible for a whistleblower award in a covered action, but companies or organizations do not qualify for whistleblower awards.
To be considered as providing “original information” to the SEC, a whistleblower must have derived his or her information from information that is not publicly available (i.e. not from news sources, court cases, or government reports or audits) or from independent analysis of public information which revealed information not generally known, or already known, to the SEC.