The Securities and Exchange Commission has given out nearly $200 million in rewards to whistleblowers in 2021, surpassing its annual record.
The regulator awarded $500,000 to a whistleblower on Monday bringing this year’s total number of award recipients to 40 individuals, another record, according to a press release.
The most recent whistleblower action “allowed the Commission and another agency to quickly file actions, shutting down an ongoing fraudulent scheme.” Specific details on the “fraudulent scheme” or the whistleblower’s identity weren’t revealed by the SEC.
The SEC has now awarded roughly $760 million to 145 individuals since issuing its first award in 2012.
The goal of the whistleblower program at the SEC is to “minimize the harm to investors, better preserve the integrity of the United States’ capital markets, and more swiftly hold accountable those responsible for unlawful conduct.”
The Office of the Whistleblower was established by Congress on July 21, 2010 in Section 922 of the Dodd-Frank Act.
Whistleblowers are eligible for an award under the act if they voluntarily provide the SEC with “original, timely, and credible information” that leads to a “successful enforcement action.” Awards for whistleblowers can range from 10%-30% of the money collected when sanctions exceed $1 million.
Payments to whistleblowers are made out of an investor protection fund established by Congress. The fund is financed entirely through “monetary sanctions paid to the SEC by securities law violators.”