Last September in How to Make Money Blowing Whistles, we described a new government program designed to fight fraud.
You’ll find the details there, but the gist is this: Provide the government with solid evidence of fraud and you can reap a bounty – up to 30 percent of the fines the government collects as punishment.
Yesterday, the U.S. Securities and Exchange Commission announced its first award from the program…
The award recipient, who does not wish to be identified, provided documents and other significant information that allowed the SEC’s investigation to move at an accelerated pace and prevent the fraud from ensnaring additional victims. The whistleblower’s assistance led to a court ordering more than $1 million in sanctions, of which approximately $150,000 has been collected thus far. The court is considering whether to issue a final judgment against other defendants in the matter. Any increase in the sanctions ordered and collected will increase payments to the whistleblower.
The anonymous tipster got the full 30 percent cut of the $150,000 collected so far. And if the judgment is more than $1 million, he or she can probably expect to see at least another cool quarter million from the SEC.
Somebody else who provided intel won’t get anything, “because the information provided did not lead to or significantly contribute to the SEC’s enforcement action, as required for an award.”
Want to report something? Head to www.sec.gov/whistleblower.