How Does the SEC Determine Whistleblower Rewards?
When the Securities and Exchange Commission (SEC) is able to identify individuals and corporations that are engaging in securities law violations due to the information provided by a whistleblower, the whistleblower can be eligible for an award under specific circumstances.
First, you must meet the eligibility requirements as outlined in the Dodd-Frank Act. Once you’ve met the criteria, the SEC will evaluate the influence of your tip and the impact on its investigation to determine how much you should be awarded. This amount can fluctuate between 10 and 30 percent of the recovered sanctions.
Qualifying for an Award
You must meet very specific requirements in order for the SEC to begin considering what your award should be. When the SEC begins an investigation, if you haven’t already come forward with a tip pertaining to the case, it is crucial that you do so now. Your information must be provided voluntarily. This means that you must come to the SEC prior to being questioned about the case.
The information you provide must also be original. If you obtained your tip from a news report or other publicly released information, it will not be considered original. Your report should also be the first—if multiple whistleblowers come forward with the same information, you need to have been the first one to make that tip in order to qualify for an award.
Finally, for you to be eligible for an award, the SEC must be able to utilize your tip to take enforceable action against the violating corporation or individual. This action can include compelling the ceasing of the action in question and possible jail time for fraudsters, and it must always lead to the recovery of sanctions totaling a minimum of $1 million if you hope to become an award-winning whistleblower.
The Impact of Your Tip
Once all of the aforementioned criteria have been met, the SEC will determine how influential your tip was to the success of the case. The greater the impact of your tip, the higher your award is likely to be.
If you were able to provide specific information, including internal documents, individual names, or financial statements supporting your tip, you have a better chance of receiving a higher percentage of the recovered sanctions.
Speak with an SEC Whistleblower Lawyer
Are you considering becoming a whistleblower? Have you already reported a tip but need more information about what you can expect moving forward? If so, reach out to a qualified SEC whistleblower lawyer at Meissner Associates today. You can schedule a no-obligation consultation by filling out the secure contact form below or calling 1-866-764-3100.