It has been a good couple of years for corporate whistleblowers at the U.S. Securities and Exchange Commission. The SEC has nabbed a number of businesses for fraud using whistleblower tips, and in many cases, those who speak out have been rewarded with lots of cash. Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the SEC can give whistleblowers between 10 and 30 percent of the money it collects when sanctions in a case are more than $1 million. In one record-setting payout, an overseas whistleblower received upward of $30 million from the commission.
This week, the SEC announced its latest award, a payout of more than $325,000 to a former employee of an unspecified investment firm who tipped the commission off to fraud. Although $325,000 is a nice chunk of change, the commission said the award would have been higher if the anonymous tipster had “not hesitated” in coming forward. The message from the SEC seems clear: a delay in reporting suspicious activity will cost money.
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