SEC Whistleblower Program Received 3,001 Tips in Fiscal Year 2012
By Elizabeth Murphy | November 15, 2012 1:34 pm

The Securities and Exchange Commission received 3,001 tips in the fiscal year that ended Sept. 30, with 115, or almost 4 percent, related to the Foreign Corrupt Practices Act, according to a report released Thursday by the agency.

The SEC’s whistleblower office opened in August 2011 as a byproduct of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act. The office pays between 10 and 30 percent of an enforcement award that exceeds $1 million if a whistleblower provides information that leads to enforcement action.

It issued its first award in August, paying $50,000 to the unnamed whistleblower, which amounted to the maximum 30 percent allowed by law. The office has so far posted 143 “Notices of Covered Action,” which relate to cases that surpass the $1 million threshold. Whistleblowers have 90 days after the notices are posted to apply for an award.

Thursday’s report indicates that most tips related to potential violations of corporate disclosure, fraud statutes and insider trading. California produced the most tips in the United States, with 435 in 2012. New York was second with 246. Abroad, the United Kingdom reported 74 possible violations, followed by Canada with 46 and India with 33.

The office’s whistleblower fund was at $453,429,825.58 at the end of the fiscal year.

The office is headed by Sean X. McKessy, and Jane A. Norberg serves as the Deputy Chief. The report noted that the SEC’s whistleblower office has eight attorneys, three paralegals and one support specialist.

Eugene Goldman, a partner at McDermott Will & Emery LLP and former senior counsel in the SEC’s Division of Enforcement, told Just Anti-Corruption that it’s too early to really measure the success of the program. However, it’s a positive sign that the public is clearly responding to the availability of the program, he said.

“I think 2013 will provide a good test on the performance because we will be able to see whether the tips that came in previously eventually generated a successful enforcement action,” Goldman told Just Anti-Corruption.

UPDATE 4:20 p.m.: This story has been updated to include comment from Eugene Goldman, partner at McDermott Will & Emery LLP.

Facebook Twitter Linkedin Email

Leave a Comment

You must be logged in to post a comment.

Barnes & Thornburg LLP
ANALYSIS: “Hide No Harm Act Of 2015” Targets Employers, Directors and Officers more
Sheppard, Mullin, Richter & Hampton LLP
ANALYSIS: The Schrems Decision: How the End of Safe Harbor Affects Your FCPA Compliance Plan more
Paul Hastings LLP
ANALYSIS: The Yates Memorandum: Increasing the Perils of Parallel Proceedings more
Arnold & Porter LLP
ANALYSIS: Global Reach? Extraterritorial Application of US Criminal Law  more
Dechert LLP
ANALYSIS: U.S. Chamber of Commerce Joins Chorus Pushing For Overhaul in SEC Enforcement Practices more
Orrick, Herrington & Sutcliffe LLP
ANALYSIS: There’s a New Sheriff In Town: Coverage for World Bank Investigations and Sanctions more