WASHINGTON (CN) – An unnamed whistleblower and company insider was awarded more than $1.7 million for helping the Securities and Exchange Commission stop a fraud scheme and return millions to investors, the agency said Thursday.
“This whistleblower’s valuable information enabled us to stop further investor harm and ultimately return money to victims,” Jane Norberg, chief of the SEC’s Whistleblower Office, said in a statement.
The whistleblower and their company are not named in the agency’s announcement or order determining the award, and no details about the scheme were revealed.
According to the redacted filing, the commission weighed its decision to issue the award against several factors.
Had the insider not alerted the SEC, the financial damage would have likely gone on unabated and unnoticed, according to the agency.
“Claimant, a company insider, reported an ongoing securities law violation to the Commission that would have otherwise been difficult to detect,” the order states. “Thereafter, claimant provided critical information that helped end the multi-year fraud and, as a result, millions of dollars were returned to harmed investors.”
The SEC said it still issued the $1.7 million award to the whistleblower even though they had “some, albeit limited, culpability” in the scheme and delayed getting the information to the SEC.
“We have not applied the delay factor as severely here as we otherwise might have had the delay occurred after the whistleblower program was established by the Dodd-Frank Act and after the whistleblower protections were in place,” the order says.
The whistleblower’s award is a percentage of sanctions that have been or will be collected in the case.
The redacted order does not state what percentage of the sanctions the award equals, but the SEC says whistleblower awards range from 10 to 30 percent of the money collected when sanctions surpass $1 million. Payments are made directly from an investor protection fund that is overseen by Congress.
To date, $158 million has been awarded to 46 whistleblowers who have turned over valuable information to the SEC that led to successful enforcement actions, the agency said.