The Securities and Exchange Commission (SEC) applauded two whistleblowers who provided “significant information” that helped regulators shut down two separate fraud schemes that “preyed on retail investors,” the agency said. The awards were the first the SEC issued to informants in 2020.

SEC whistleblower stock exchange shutterstock 5212221941 364x210 SEC: Whistleblowers exposed schemes that preyed on retail investorsIn one case, the whistleblower alerted the SEC to a fraud scheme the agency may have never detected otherwise. The SEC followed the whistleblower’s leads, took enforcement action against the offending company, and awarded the whistleblower more than $277,000. According to the SEC, the informant continued to provide assistance throughout the ongoing scheme.

The second case was kicked off by a harmed investor. The SEC said that the whistleblower provided critical information that enabled it to recover assets, which were returned to victims of the company’s fraud scheme. The SEC awarded that whistleblower $45,000 for the tips and information, which he or she continued to provide throughout the investigation.

“Both whistleblowers awarded today played a crucial role in helping the Commission protect Main Street investors,” said Jane Norberg, Chief of the SEC’s Office of the Whistleblower. “The information provided saved the SEC time and resources in conducting the investigations and assisted the SEC in returning money to harmed investors.”

The SEC has awarded approximately $387 million to 72 individuals since issuing its first whistleblower award in 2012. In fiscal year 2019, the SEC received more than 5,200 whistleblower tips — its second-largest number of whistleblower tips in a year since the whistleblower program was launched in 2011. The Commission has received more than 33,000 whistleblower tips to date.

The SEC said the tips it received last year came from individuals in every U.S. state and 70 foreign countries. While the whistleblower allegations concerned a variety of securities fraud, the agency noted that fraud involving cryptocurrencies is a quickly growing trend. About 300 of the tips the SEC received in 2019 concerned some form of cryptocurrency fraud.

“We continue to take pride in the whistleblower program’s contributions to the protection of markets and investors including, importantly, Main Street investors,” said Norberg in the SEC Office of the Whistleblower’s 2019 Report to Congress.

If you have any questions about whether you qualify as a whistleblower, contact one of the lawyers on our firm’s Whistleblower Litigation Team for a free and confidential evaluation of your claim. Beasley Allen lawyers Larry Golston, Lance Gould, Paul Evans, Leslie Pescia, Leon Hampton, Tyner Helms and Lauren Miles are working in this area of law known as qui tam cases. A lawyer on the team will be glad to discuss the potential claim with you either in person or by phone.

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