After a relatively quiet year of SEC whistleblower awards, the SEC seems to be on a bit of a roll with its announcement today of a $24 million award to two whistleblowers. This follows last Friday’s award (August 23) of a whopping $98 million to two whistleblowers, which followed two $37 million awards last month (on July 26 and July 17). There had been no other awards this year up to that point. Whatever may have been the cause for this uncharacteristic pause in SEC awards, there seems little question the SEC Whistleblower Program is back on track.

Keeping to its strict commitment of maintaining the confidentiality of its whistleblowers, the SEC did not reveal the identity of the whistleblowers. Nor did it identify the enforcement action on which the whistleblowers provided assistance. All we know is one whistleblower received $4 million and the other received $20 million. Notably, unlike last Friday’s award, the big winner here was the whistleblower who provided information after the SEC already opened the investigation.

The accompanying SEC Order explains why. The first whistleblower prompted the SEC to open the investigation, but the SEC found they had limited knowledge of the misconduct and waited two years to report to the agency. In contrast, the second-in-line whistleblower provided information that expanded the scope of the investigation, including important information about key witnesses and their roles in the scheme. They also internally reported the conduct prompting the company to conduct an internal investigation.

There are three key whistleblower takeaways here. First, do not delay reporting to the agency. Second, the quality of your information and assistance matters more than being first in the agency door. And third, the SEC highly values internal reporting. The lessons to be learned on the first two points should be clear for whistleblowers. Speed and comprehensiveness are key.

But the third point is more nuanced. Alerting the company to wrongdoing allows the company to redress the conduct internally and can save the government the time and energy involved in taking enforcement action. However, reporting internally is not always a wise or realistic path for whistleblowers as it may expose them to punishment and retribution. Ultimately, it depends on how receptive the company is to whistleblower complaints and what protocols and protections it has in place for those willing to speak their truth to power.

For those would-be SEC whistleblowers contemplating their next move, the good news is regardless of how your company treats whistleblowers, the SEC will welcome you with open arms. Indeed, as SEC Whistleblower Chief Creola Kelly stressed, these latest awards “highlight the incredible public service provided by whistleblowers.” It is a sentiment the SEC continues to recognize by both word and deed.

So if you have information of potential securities fraud and would like to speak to an experienced member of the Constantine Cannon whistleblower team, please do not hesitate to contact us for a free and confidential consultation. We will work with you to find the whistleblower path that makes most sense to you.

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