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SEC whistleblower payments exceed $ 1 billion, says the financial regulator

Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), testified before an oversight hearing of the Senate Committee on Banking, Housing and Urban Affairs on the SEC’s Capitol Hill in Washington, September 14, 2021.

Evelyn Hockstein | Swimming pool | Reuters

The Securities and Exchange Commission said Wednesday the total number of payments he had made to whistleblowers had exceeded $ 1 billion after the financial watchdog issued its second-largest award ever given to a person for signs of malpractice.

The SEC said one person this week paid $ 110 million combined for information and assistance that has led to successful actions by the SEC and other entities.

About $ 40 million of that payment was linked to a SEC case, with the rest from actions connected by another unidentified agency.

That total award was close to the record $ 114 million prize issued last October by the regulator, which began paying royalties to whistleblowers in 2012.

Another individual recently received a $ 4 million award for information, the SEC said, bringing the account for such payments this year to more than $ 500 million.

Earlier this year, the third largest whistleblower prize, worth $ 50 million, was issued.

The SEC by law does not disclose the identity of whistleblowers or the information they may bring to reveal their identity.

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Since the program began, the SEC has paid 207 whistleblowers more than $ 1.07 billion, according to the agency, whose mission is to protect investors and keep markets fair and efficient.

Those payments, which range in value from 10% to 30% of monetary sanctions imposed by the SEC in excess of $ 1 million, are funded by sanctions, not by investors who have been harmed.

The SEC said the information provided by the complainants since the beginning of the program has led to more than $ 4.8 billion in financial remedies.

“We’ve just made a stop,” SEC President Gary Gensler said in a tweeted video announcing that the billion-dollar payment threshold had been exceeded.

“All the complainants have provided an important service,” Gensler said. “When I look at the commission’s enforcement actions each week, I remember how the whistleblower program helps us be better able to pace, execute our mission, and protect investors from bad behavior.”

Gensler in that video encouraged future whistleblowers to visit the SEC’s flagship site: www.sec.gov/whistleblower.

Earlier Wednesday, during an interview with CNBC’s “Squawk on the Street,” Gensler said the SEC addresses a number of challenging enforcement issues even when it has up to 5% of staff members in less than five years. to do.

“We have an IPO boom, we have an SPAC boom, we have cryptocurrencies to deal with,” Gensler said. “I’d like to at least come back [staff level] where we were in 2016 and I think we should probably be 5% or 10% bigger than that. ”

Gensler told the Senate Tuesday that he needs “many more people” to help deal with thousands of new digital assets, such as cryptocurrencies.


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