Statement on Amendments to the Whistleblower Program
Feb. 10, 2022
Today, the Commission voted to propose amendments to rules governing the SEC’s whistleblower program. I support these amendments because, if adopted, they would help ensure that whistleblowers are both incentivized and appropriately rewarded for their efforts in reporting potential violations of the law to the Commission.
After the 2008 financial crisis, Congress under the Dodd-Frank Act directed the SEC to establish a whistleblower program. The Commission was directed to pay awards, subject to certain limitations and conditions, to whistleblowers who provide original information that leads to a successful enforcement involving wrongdoing in the securities markets.
Whistleblowers provide a critical public service and duty to our nation, taking personal and professional risks in doing so. Since the program’s inception, enforcement matters brought using information from whistleblowers have resulted in more than $1.3 billion that has been (or is scheduled to be) returned to harmed investors.
Today’s release would help ensure the whistleblower program’s continued success.
The first proposed amendment concerns award claims for related actions that would be otherwise covered by an alternative whistleblower program. Under this proposal, the SEC could pay such claims if the alternative whistleblower award program was not comparable to the SEC’s award program. The proposed rule change is designed to ensure that a whistleblower is not disadvantaged by another whistleblower program that would not give them as high an award as the SEC would offer.
Under the second proposed rule change, the SEC could consider the dollar amounts of potential awards only to increase the whistleblower’s award. This would give whistleblowers additional comfort knowing that the SEC could consider the dollar amount of the award only in such cases.
I am pleased to support today’s release. I’d like to extend my gratitude to the members of the SEC staff who worked on this rule, including:
- Michael Conley, Laura Jarsulic, William Shirey, Hannah Riedel, Stephen Yoder, Bryant Morris, and Connor Raso in the Office of the General Counsel;
- Cree Kelly, Emily Pasquinelli, Lisa Wardlaw, Rebecca Franciscus, and Kevin Logan in the Office of the Whistleblower; and
- Jessica Wachter, Chyhe Becker, Lauren Moore, Andrew Glickman, and Hamilton Martin in the Division of Economic and Risk Analysis.