Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.
According to the Securities and Exchange Commission’s (SEC) 2013 Annual Report to Congress on the Dodd-Frank Whistleblower Program, the agency awarded four whistleblowers a total of $14,831,965.64 during the fiscal year. More than $14 million of that sum was given to a single whistleblower. Under the Dodd-Frank whistleblower incentive program, individuals who report original information that leads the SEC to recover monetary sanctions of $1 million or more are eligible to receive awards of 10 to 30% of that financial recovery. This year, whistleblowers filed 3,238 tips and complaints with the agency, up from 3,001 filed in 2012. Since the program’s inception in August 2011, the SEC has received 6,573 tips and complaints. Other highlights of this year’s report include the following:
- For each enforcement action resulting in a final judgment or order resulting in monetary sanctions exceeding $1 million, the SEC’s Office of the Whistleblower (OWB) posts a Notice of Covered Action (NoCA) on its website. During this past fiscal year, the OWB posted 118 NoCAs. As noted, however, only four whistleblowers were given monetary awards during this period.
- Individuals blew the whistle most often for allegations involving corporate disclosures and financials (17.2%), offering fraud (17.1%), and manipulation (16.2%), the same three categories as reported in FY 2012.
- Most tips and complaints were reported in California (375), New York (215), Florida (187), and Texas (135), although the SEC notes that it received whistleblower submissions from all 50 states, the District of Columbia, and the U.S. territories of Puerto Rico, Guam, and the U.S. Virgin Islands.
- The SEC received tips from 55 foreign countries as well during FY 2013, mostly from the United Kingdom (66), Canada (62), and China (52).
The full SEC report includes an overview of the OWB, the Inspector General’s evaluation of the SEC’s bounty program, and a history and purpose of the Dodd-Frank program.