- Chief Compliance Officer and VP of Legal Affairs, Arrow Electronics
By 
Aaron Nicodemus2024-07-19T16:20:00
A whistleblower will be paid $37 million by the Securities and Exchange Commission (SEC) for providing original, credible information that led to a successful enforcement action.
The award, announced in a press release Wednesday, will be paid out through an investor protection fund that is financed through penalties paid to the SEC by securities law violators. Whistleblower awards consist of between 10 and 30 percent of money collected in an enforcement action when the sanctions exceed $1 million.
The SEC protects the confidentiality of all whistleblowers and does not link the award to a particular enforcement action, as mandated by the Dodd-Frank Act, which established the SEC’s whistleblower program.
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Two pairs of claimants will receive whistleblower awards totaling more than $98 million and $24 million, respectively, for information they provided to the Securities and Exchange Commission that led to an enforcement action.
The Securities and Exchange Commission announced its second $37 million whistleblower award in as many weeks with four claimants vying for the payout, but only one reaping the benefits.
Anonymous employees of OpenAI accused the company of requiring employees to sign nondisclosure agreements (NDAs) that “prohibited and discouraged” them from reporting securities law violations to federal regulators.
Discrimination against whistleblowers in the U.K. has risen to such a level that the government may need to actively pursue plans to afford greater legal protection, as well as introduce financial awards to compensate for their “career suicide.”
The Department of Justice released the details of its long-awaited corporate whistleblower awards pilot program that will prioritize reporting in areas of corporate crime not currently covered by existing whistleblower programs.
The Consumer Financial Protection Bureau is warning companies against intimidating potential whistleblowers by forcing them to sign broad nondisclosure agreements to deter misconduct from coming to light.
