Whistle-Blower Gets Record $50 Million Payout for Aiding SEC

(Bloomberg) -- The U.S. Securities and Exchange Commission awarded a record payment of nearly $50 million to a whistle-blower who provided information about a company's misconduct that helped the agency bring an enforcement case that returned a significant amount of money to harmed investors.

The whistle-blower provided detailed, firsthand observations of the wrongdoing, the SEC said in a Thursday statement. The agency didn't identify the whistle-blower or the company involved, citing federal law that protects confidentiality.

“Whistle-blowers have proven to be a critical tool in the enforcement arsenal to combat fraud and protect investors,” Jane Norberg, head of the SEC's whistle-blower office, said in the statement.

The nearly $50 million award is the largest ever for a single whistle-blower, the SEC said. Two people shared a nearly $50 million award in 2018, and a $39 million payment the same year was the previous record for an individual. The SEC has awarded more than $500 million to 83 individuals since its first award in 2012.

Whistle-blowers are eligible for payouts if they voluntarily give the SEC unique information that leads to a successful enforcement action. Compensation can range from 10% to 30% of the money collected in a case where sanctions exceed $1 million. No money from harmed investors is used to pay whistle-blower awards.

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