Difference between revisions of "SEC Whistleblower Program"

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='''Lessons Learned from SEC Whistleblower Award Determinations'''=
='''Lessons Learned from SEC Whistleblower Award Determinations'''=
The SEC Whistleblower Program has issued more than $1 billion in awards to whistleblowers since 2012, which includes a multi-million dollar award to one of our clients. The largest SEC whistleblower awards to date are $114 million, $110 million, and $50 million. The orders announcing the awards, while sparse, offer critical guidance on how to: (1) recover an award; and (2) maximize the award percentage. These five lessons are drawn from those orders and our experience effectively representing SEC whistleblowers.
The [https://www.zuckermanlaw.com/sp_faq/sec-whistleblower-program/ SEC Whistleblower Program] has issued more than [https://www.sec.gov/page/whistleblower-100million '''$1 billion in awards'''] to whistleblowers since 2012, which includes a '''multi-million dollar award to a client of Zuckerman Law.''' The [https://www.zuckermanlaw.com/sp_faq/largest-sec-whistleblower-awards/ largest SEC whistleblower awards] to date are $114 million, $110 million, and $50 million. The [https://www.sec.gov/whistleblower/final-orders-of-the-commission orders] announcing the awards, while sparse, offer critical guidance on how to: (1) recover an award; and (2) maximize the award percentage. These five lessons are drawn from those orders and our experience [https://www.zuckermanlaw.com/how-best-sec-whistleblower-law-firms-advocate-sec-whistleblowers/ '''<u>effectively representing SEC whistleblowers.</u>''']
 
=='''Tip #1: Establish a Material Violation'''==
=='''Tip #1: Establish a Material Violation'''==
Many SEC whistleblower attorneys will incorrectly begin the analysis of a claim by determining a whistleblower’s eligibility for an award. This puts the cart before the horse. The first step in any successful whistleblower claim is to determine whether you can establish a material violation of federal securities law. In other words, can you show the SEC that your tip concerns a violation that is serious enough to warrant the use of its limited resources?
Many SEC whistleblower attorneys will incorrectly begin the analysis of a claim by determining a whistleblower’s eligibility for an award. This puts the cart before the horse. The first step in any successful whistleblower claim is to determine whether you can establish a material violation of federal securities law. In other words, can you show the SEC that your tip concerns a violation that is serious enough to warrant the use of its limited resources?
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Whistleblowers have filed more than 40,200 tips with the SEC since August 2011. In a perfect world, the SEC would be able to investigate all legitimate tips and stop even immaterial violations. However, the SEC has limited resources, so it can pursue only the best tips. (See Tip #5 on how to get the SEC’s attention with your tip.)
Whistleblowers have filed more than 40,200 tips with the SEC since August 2011. In a perfect world, the SEC would be able to investigate all legitimate tips and stop even immaterial violations. However, the SEC has limited resources, so it can pursue only the best tips. (See Tip #5 on how to get the SEC’s attention with your tip.)


If you have a hunch about a violation but lack any proof, then it may be worth investigating further, rather than submitting an incomplete or speculative claim to the SEC. Tips generally fall to the wayside unless they provide “specific” and “credible” information about a material violation of the federal securities laws. That said, if you have such information about a material violation, you will most likely want to submit your Form TCR as soon as possible (see Tip #3) unless you are required to take certain steps prior to submitting a tip in order to be eligible for an award.
If you have a hunch about a violation but lack any proof, then it may be worth investigating further, rather than submitting an incomplete or speculative claim to the SEC. Tips generally fall to the wayside unless they provide “specific” and “credible” information about a material violation of the federal securities laws. That said, if you have such information about a material violation, you will most likely want to submit your [https://www.zuckermanlaw.com/sec-whistleblower-program-sec-form-tcr/ Form TCR] as soon as possible (see Tip #3) unless you are required to take [https://www.zuckermanlaw.com/sp_faq/can-compliance-personnel-auditors-officers-directors-obtain-award-sec-whistleblower-program/ certain steps] prior to submitting a tip in order to be eligible for an award.
=='''Tip #2: Quickly Determine Eligibility Because It May Affect Award Percentage'''==
=='''Tip #2: Quickly Determine Eligibility Because It May Affect Award Percentage'''==
The next step in any successful whistleblower claim is to determine eligibility. This step follows a finding of a material violation because, while most individuals cannot establish a material violation, almost everyone can become eligible for an award, if certain steps are taken. Lawyers, external and internal auditors, and even individuals involved in the wrongdoing are among those who may be eligible for awards.
The next step in any successful whistleblower claim is to determine eligibility. This step follows a finding of a material violation because, while most individuals cannot establish a material violation, almost everyone can become eligible for an award, if certain steps are taken. Lawyers, external and internal auditors, and even individuals involved in the wrongdoing are among those who may be eligible for awards.