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Last week, the SEC announced its biggest whistleblower reward so far this year, compensating four joint informants $28m after they “significantly contributed to the success of the action” against the wrongdoers.
Surprisingly, a multi-million dollar payout isn't uncommon in the world of financial whistleblowing. Just last month, one source was awarded $37m for their efforts in a healthcare bribery case, becoming one of the top ten highest-paid individual informants in the history of the SEC's whistleblowing scheme.
Snitches get riches
Compensating whistleblowers has cost the SEC over $1.3bn since it devised the program in 2010 to incentivize industry insiders to help catch financial criminals. And, while tips have risen almost every year since, the last couple have seen the whistleblowing volume taken to the next level. Whistleblowing tips grew 76% from 6,911 in 2020 to more than 12,000 in each of the last 2 years.
Along with increased awareness of the SEC program, it's hard to argue with the fact that — in the age of remote working — reporting the boss’s underhand dealings is much easier if you’re not making watercooler small talk with them every day.
One new fertile space for financial crime has been crypto. Last year more than 1,700 tips found their way to the SEC about crypto-related crimes, a category that has grown quickly alongside the sector, with Gemini & Genesis the latest crypto companies targeted by the SEC.
