The incentive has certainly existed for whistleblowers to report securities fraud since the inception of the federal Dodd-Frank Act several years ago.
We note on our website at the law firm of Hilder & Associates in Houston that the U.S. Securities and Exchange Commission’s whistleblower program rewards individuals with sizable money awards in select cases. Those persons can receive up to 30% of all the money recovered by regulators in fraud-linked matters where at least $1 million in fines is clawed back from offenders
A recent Wall Street Journal article notes that such a payback on effort (concededly, often courageous action that comes with personal risk and the potential for employer retaliation) is strong inducement for individuals with personal knowledge of fraud to come forward. Indeed, that publication spotlights the $158 million awarded to SEC whistleblowers during the six years leading up to 2018.
As impressive as that amount is, it pales in comparison to what whistleblowers received in just the most recent fiscal year alone. The reported $168 million taken in by those individuals in large-recovery cases this past year underscores mightily just how robust the program has become.
It “has gone from adolescence to adulthood,” says one commentator, who joins other voices in stressing that amped-up award amounts doled out in the largest whistleblower cases have brought an infusion of fraud-linked tips.
And not just from persons inside the United States with knowledge of malfeasance within the securities industry. The Journal reports that tips fielded by the SEC in the past fiscal year came in from more than 70 countries.
Individuals seeking information or having specific questions about the SEC whistleblower program might reasonably want to contact Hilder & Associates for a confidential and candid consultation. We note on our website that our attorneys “have represented some of the most high-profile whistleblower cases in Texas and the nation in recent years.”