In mid-November, the US Securities and Exchange Commission’s (SEC) Office of the Whistleblower released its 2017 Annual Report. The report indicates that the SEC Whistleblower Programme has been effective in protecting investors, and indeed whistleblower tips have enabled the SEC to recover nearly $1bn in monetary sanctions from wrongdoers.

The report also indicates that the programme is growing. In fiscal year 2017, the SEC received over 4400 tips, an increase of nearly 50 percent since fiscal year 2012. Most significantly, whistleblower disclosures have played a critical role in halting ongoing fraud schemes, thereby facilitating the SEC’s ability to achieve its core mission of protecting investors.

The SEC Whistleblower Office’s annual report also reveals that whistleblowers outside the US are actively participating in the programme, including disclosures about violations of the Foreign Corrupt Practices Act (FCPA) and abuse of the EB-5 Immigrant Investor Program. During fiscal year 2017, whistleblowers in 72 countries filed tips with the SEC.

But the report indicates that the odds of recovering an award are low. Since the inception of the Dodd-Frank Act whistleblower reward programme, approximately 22,000 whistleblowers have filed submissions with the SEC’s Office of the Whistleblower, yet fewer than 50 whistleblowers have received awards. Below are some key lessons learned or tips for SEC whistleblowers.

Jan-Mar 2018 Issue

Zuckerman Law