2022-03-11 SEC Press press_release 61 KB 1,896 chars

SEC Awards Approximately $14 Million to Whistleblower

Release
2022-40
Source PDF JSON
summary

A whistleblower exposed an ongoing company fraud through an online report, prompting an SEC investigation and enforcement action that returned millions to harmed investors, and was awarded $14 million.

paragraph

The SEC awarded $14 million to a whistleblower who exposed an ongoing company fraud, resulting in a successful enforcement action and the return of millions of dollars to harmed investors. The whistleblower's timely and credible information led to an investigation and sanctions against the company and its officer. The payment came from the SEC's Investor Protection Fund, financed entirely by penalties from violators.

narrative

A whistleblower exposed an ongoing company fraud through an online report, prompting an SEC investigation and enforcement action that returned millions to harmed investors. The whistleblower's timely and credible information led to an investigation and sanctions against the company and its officer, qualifying them for a 10-30% award under the Dodd-Frank Act. The SEC awarded $14 million to the whistleblower, with the payment coming from the SEC's Investor Protection Fund, financed entirely by penalties from violators. Since 2012, the SEC has awarded approximately $1.2 billion to 249 whistleblowers, emphasizing confidentiality and incentivizing direct reporting to the agency. The SEC emphasized the importance of direct reporting to the agency and reaffirmed its commitment to protecting whistleblower confidentiality. The whistleblower's actions demonstrate the critical role that whistleblowers can play in an investigation, and the SEC encourages others to come forward with original, timely, and credible information.

Enriched metadata

Scheme
corporate-fraud (85%)
Victim loss
$1,200,000,000
Classified corporate-fraud(confidence 85%). EDGAR detection: forms 10-K/10-Q/8-K· recall 56% / precision 8%. detection rule →
Parties
an investor protection fundcreola kellyentirely through monetary sanctions paid to the secinvestor protection fundSecurities and Exchange Commissionthe same information with the secwhistleblower awards
Keywords
whistleblowersecmillion whistleblowerinformationawardsmillionwhistleblowersawards millionsuccessful enforcementenforcement actionharmed investorsmonetary sanctionswhistleblower awardsawardreport

Exhibits & Attached Documents (1)

Extracted insights

Dollar amounts 3
  • $1.20B $1.2 billion ≥$1B
  • $14.00M $14 million $10M–$100M
  • $1.00M $1 million $1M–$10M
Entities 7
  • company an investor protection fund
  • person creola kelly
  • agency entirely through monetary sanctions paid to the sec
  • company investor protection fund
  • agency Securities and Exchange Commission
  • agency the same information with the sec
  • person whistleblower awards
Triples 16
  • SecSecurities and Exchange Commission awarded $14 million to a whistleblower
  • whistleblower published an online report exposing an ongoing fraud
  • whistleblower shared the same information with the SEC
  • whistleblower prompted the opening of an investigation
  • investigation resulted in a successful enforcement action
  • investigation resulted in the return of millions of dollars to harmed investors
  • Creola Kelly said Whistleblowers can play a critical role in an investigation
  • whistleblower posted a research report online outlining the allegations
  • whistleblower took expeditious steps to provide this information to the Commission
  • SEC awarded approximately $1.2 billion to 249 individuals
  • Congress established an investor protection fund
  • investor protection fund is financed entirely through monetary sanctions paid to the SEC
  • Whistleblowers may be eligible for an award when they voluntarily provide the SEC with original, timely, and credible information
  • Whistleblower awards can range from 10 percent to 30 percent of the money collected
  • SEC protects the confidentiality of whistleblowers
  • SEC does not disclose information that could reveal a whistleblower’s identity
PDF (from attached: pdf)
In the Matter of the Claims for an Award · Source
Text layers
Extracted body text (1,896c) 
The Securities and Exchange Commission today announced an award of about $14 million to a whistleblower who published an online report exposing an ongoing fraud. The whistleblower, who days later shared the same information with the SEC and was persistent in reaching out to the staff, prompted the opening of an investigation which resulted in a successful enforcement action and the return of millions of dollars to harmed investors. "Whistleblowers can play a critical role in an investigation," said Creola Kelly, Chief of the SEC’s Office of the Whistleblower. "Here, the whistleblower posted a research report online outlining the allegations against the company and its officer and also, importantly, took expeditious steps to provide this information to the Commission. This case demonstrates the importance of whistleblowers reporting directly to the SEC so that the agency can promptly investigate allegations of wrongdoing." The SEC has awarded approximately $1.2 billion to 249 individuals since issuing its first award in 2012. All payments are made out of an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators. No money has been taken or withheld from harmed investors to pay whistleblower awards. Whistleblowers may be eligible for an award when they voluntarily provide the SEC with original, timely, and credible information that leads to a successful enforcement action. Whistleblower awards can range from 10 percent to 30 percent of the money collected when the monetary sanctions exceed $1 million. As set forth in the Dodd-Frank Act, the SEC protects the confidentiality of whistleblowers and does not disclose information that could reveal a whistleblower’s identity. For more information about the whistleblower program and how to report a tip, visit www.sec.gov/whistleblower.
OCR text (1,896c · html-text · 99% conf) 
The Securities and Exchange Commission today announced an award of about $14 million to a whistleblower who published an online report exposing an ongoing fraud. The whistleblower, who days later shared the same information with the SEC and was persistent in reaching out to the staff, prompted the opening of an investigation which resulted in a successful enforcement action and the return of millions of dollars to harmed investors. "Whistleblowers can play a critical role in an investigation," said Creola Kelly, Chief of the SEC’s Office of the Whistleblower. "Here, the whistleblower posted a research report online outlining the allegations against the company and its officer and also, importantly, took expeditious steps to provide this information to the Commission. This case demonstrates the importance of whistleblowers reporting directly to the SEC so that the agency can promptly investigate allegations of wrongdoing." The SEC has awarded approximately $1.2 billion to 249 individuals since issuing its first award in 2012. All payments are made out of an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators. No money has been taken or withheld from harmed investors to pay whistleblower awards. Whistleblowers may be eligible for an award when they voluntarily provide the SEC with original, timely, and credible information that leads to a successful enforcement action. Whistleblower awards can range from 10 percent to 30 percent of the money collected when the monetary sanctions exceed $1 million. As set forth in the Dodd-Frank Act, the SEC protects the confidentiality of whistleblowers and does not disclose information that could reveal a whistleblower’s identity. For more information about the whistleblower program and how to report a tip, visit www.sec.gov/whistleblower.

Related documents (1)