The U.S. Securities and Exchange Commission (SEC) announced a whistleblower award totaling more than $325,000 for a former investment firm employee who tipped the agency with specific information that enabled enforcement staff to open an investigation and uncover the extent of the fraudulent activity.

This whistleblower, in particular, provided a detailed description of the misconduct and specifically identified individuals behind the wrongdoing to help the SEC bring a successful enforcement action.

It is worth noting that SEC officials say the $325,000 award could have been higher had this whistleblower come forward earlier instead of waiting until after leaving the firm.

Since its inception in 2011, the SEC’s whistleblower program has paid over $54 million to 22 whistleblowers who provided the SEC with unique and useful information that contributed to a successful enforcement action.

Whistleblowers are eligible for awards that can range from 10% to 30% of the money collected when the monetary sanctions exceed $1 million. All payments are made out of an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators, and no money is taken or withheld from harmed investors to pay whistleblower awards.

Andrew Ceresney, director of the SEC’s Division of Enforcement, said:

Corporate insiders who become aware of securities law violations are encouraged to come forward without delay in order to prevent misconduct from continuing unabated while investors suffer more harm. Whistleblowers are afforded significant incentives and protections under the Dodd-Frank Act and the SEC’s whistleblower program so they can feel secure about doing the right thing and immediately reporting an ongoing fraud rather than letting time pass.

Sean X. McKessy, chief of the SEC’s Office of the Whistleblower, added:

This award recognizes the value of the information and assistance provided by the whistleblower while underscoring the need for whistleblowers to report information to the agency expeditiously.

By law, the SEC protects the confidentiality of whistleblowers and does not disclose information that might directly or indirectly reveal a whistleblower’s identity.

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