The U.S. Securities and Exchange Commission has paid its largest-ever award to a whistleblower, nearly $279 million, the regulator said on Friday.
The award is more than double the previous record amount of $114 million announced in October 2020.
In a heavily redacted May 5 SEC order, the agency did not name the person to whom the reward was paid or say what enforcement actions led to the payment, a policy designed to protect whistleblowers who wish to remain anonymous.
“The whistleblower’s continued support, including multiple interviews and written submissions, was critical to the success of these actions,” said Nicole Creola Kelly, director of the SEC’s Whistleblower Office. “While the whistleblower’s information did not lead to the opening of the SEC investigation, her information expanded the scope of the alleged misconduct.”
The SEC’s order says two other people provided leads on the enforcement action, but the agency did not pay them. Any information provided by these individuals “did not advance or influence the investigation,” the SEC said. Another person’s claims were “vague” and “unsubstantiated”.
Established under the Dodd-Frank Act of 2010, the SEC’s Whistleblower Office is designed to encourage individuals with information about financial wrongdoing to assist the agency in filing complaints.
To get paid, whistleblowers must provide information leading to an SEC enforcement case of more than $1 million. Whistleblowers can be paid between 10 percent and 30 percent of the total fines collected.
The SEC says it has paid out more than $1 billion since the program began in 2011.
“Today’s award — the highest in the history of our program — not only provides an incentive for whistleblowers to report accurate information about potential securities law violations, but also reflects the tremendous success of our whistleblower program,” said Gurbir Grewal , Head of SEC Enforcement Division.