How Do Whistleblowers Get Paid?
When you become aware of possible fraudulent activity in a publicly traded company, you might be considering whether or not you should report your tip to the United States Securities and Exchange Commission (SEC).
Reporting securities violations is of utmost importance. Doing so ensures that investors’ funds are protected and financial markets continue to run smoothly.
The SEC has implemented a whistleblower program that allows would-be whistleblowers to report their tips and, if all the criteria are met, collect an award for coming forward. Read on to learn more about what you need to do to be eligible for a whistleblower award.
Why Potential Whistleblowers Are Afraid to Come Forward
Many whistleblowers have valuable information to provide to the SEC but hold themselves back from reporting their tip due to the fear of retaliation. However, the Dodd-Frank Act contains provisions that specifically protect whistleblowers from being retaliated against by their employers for suspected whistleblowing.
Unfortunately, that doesn’t mean that retaliation doesn’t happen, and most whistleblowers understand the risks. For this reason, the SEC allows whistleblowers to remain anonymous when they are represented by an attorney. This way, your identity will be protected while you bring your information to the SEC and potentially qualify for a whistleblower award if your tip meets the eligibility requirements.
Does Your Tip Meet the Criteria for an Award?
For your tip to qualify for a whistleblower award, it needs to meet all of the SEC’s eligibility requirements. This includes your tip being brought forward voluntarily, without being coaxed out of you by the SEC. Also, your tip needs to be original. This means you must be the first whistleblower to come forward with your tip, and the information needs to have been obtained through a nonpublic source.
Information you provide needs to be valuable to the SEC and lead to enforceable action, whether that be through penalties or monetary sanctions. Finally, if all of the previously mentioned criteria have been met, you will qualify for a whistleblower award when the SEC is able to recover sanctions of a minimum of $1,000,000.
Depending on how valuable your tip was to the success of their case, you could be entitled to an award of anywhere between 10 percent and 30 percent of the recovered sanctions. This is how whistleblowers are awarded for the information they’ve provided to the SEC.
Consult with an SEC Whistleblower Lawyer
If you have information about securities fraud and you are considering blowing the whistle, get in touch with a skilled SEC whistleblower lawyer at Meissner Associates as soon as possible. There is no time to waste! You can schedule your confidential tip review today by giving our office a call at 1-866-764-3100 or by submitting the secure contact form at the bottom of this page.