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SEC Annual Report: A Valuable Resource for Potential SEC Whistleblowers, SEC Whistleblower Attorneys, and SEC Whistleblower Law Firms

The following is from a blog about the SEC's annual Report to Congress and the Enforcement Director's comments welcoming the involvement of knowledgeable SEC whistleblower attorneys. It was originally posted on The Pickholz Law Offices’ website on December 6, 2016.  To see the blog as originally published, please click here.

As an SEC whistleblower attorney, I often hear questions like “How many whistleblower tips does the SEC get each year?” “How many tips get through to the investigation stage?” and other similar questions.  It is not uncommon for a client to ask one or more of these questions when interviewing a potential SEC whistleblower law firm.

Because the SEC whistleblower program has not been around for decades, there is not a lot of hard data about it yet.  This can sometimes make it difficult for an SEC whistleblower attorney to answer questions about it with a high degree of specificity.  For an SEC whistleblower law firm, this problem is compounded by the fact that the SEC has only kept full-year statistics on its whistleblower program since fiscal year 2012.

Dodd Frank Whistleblower program

Fortunately, every year the SEC is required to submit an annual report to Congress on the SEC whistleblower program.  This report can be a valuable resource for an SEC whistleblower attorney, SEC whistleblower law firm, and even potential SEC whistleblowers themselves.

The SEC’s Office of the Whistleblower (“OWB”) recently released its annual report to Congress for fiscal year 2016 (the “Report”).  Right up front on page 1, this year’s Report states that in FY 2016, the SEC gave out more than $57 million in whistleblower awards, “higher than all award amounts issued in previous years combined”.  Six of the ten largest SEC whistleblower rewards were given out in FY 2016, an indication that the SEC whistleblower program is growing.  (Report, p. 10.)  Since the inception of the SEC whistleblower program, the Commission has awarded more than $111 million.  (Report, p. 1.)

In FY 2016, The SEC received over 4,218 tips from whistleblowers, “a more than 40 percent increase” since FY 2012.  (Report, pp. 1, 23.)  Since August 2011, the SEC has received 18,334 whistleblower tips.  (Report, p. 23.)

According to the report, the OWB “tracks whistleblower tips that are referred to Enforcement staff for investigation or follow-up.  OWB is currently tracking over 800 matters in which a whistleblower’s tip has caused a Matter Under Inquiry or investigation to be opened or which have been forwarded to Enforcement staff for review and consideration in connection with an ongoing investigation.”  (Report, p. 27.)

While there are some variables that I do not have data for, based on these figures, a reasonable estimate would be that, currently, approximately 5%-7% of all whistleblower tips that the SEC receives cause investigations to be opened or substantially contribute to ongoing investigations — a prerequisite to obtaining an SEC whistleblower award.

The Involvement Of Knowledgeable SEC Whistleblower Attorneys Is Welcomed By The SEC

For potential SEC whistleblowers, these percentages are important, because they highlight the importance of hiring knowledgeable SEC whistleblower attorneys or SEC whistleblower law firms.  Knowledgeable SEC whistleblower attorneys can help to focus the facts and issues, connect them to the securities laws, and present them in a compelling way, to hopefully increase the chances of tips leading to the opening of investigations or substantially assisting in an already ongoing investigations.  This comports with comments made in a speech by the SEC’s Director of Enforcement in September, in which he said that the SEC welcomes the involvement of SEC whistleblower attorneys and described some of the ways that knowledgeable SEC whistleblower attorneys can add value to the SEC whistleblower process.  You can read my post about the Director’s speech here.

The SEC’s Annual Report to Congress on the Dodd-Frank Whistleblower Program contains a lot of other interesting information.  If you would like to read the Report for FY 2016, you can find it by clicking on the first link in the text above.

If you would like to speak with an SEC whistleblower lawyer, please feel free to call Jason R. Pickholz at 347-746-1222.

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Jason Pickholz -

The Pickholz Law Offices represents U.S. and international clients in securities and white collar cases. The Firm has helped whistleblowers report frauds to the SEC, CFTC, and IRS, and has defended clients in investigations by the SEC, CFTC, DOJ, FINRA, and other financial and securities enforcement regulators.

The Firm’s founder, Jason Pickholz, is the author of the two-volume book Securities Crimes, has appeared on tv and radio, and has taught continuing legal education courses. A former BigLaw partner, he has been representing clients in financial and securities fraud cases since 1995. In recognition of his many achievements, Mr. Pickholz was elected by his legal peers to be a Fellow of The New York Bar Foundation, an honor limited to just 1% of all attorneys in the New York State Bar Association.

Mr. Pickholz has been counsel in many high-profile cases. He was the first attorney ever to win an SEC whistleblower award on appeal to the Commission, which Inside Counsel magazine called one of the five key events in the history of the SEC whistleblower program. On the defense side, Mr. Pickholz has defended clients in the SEC’s COVID-19 investigations, the CFTC’s cryptocurrency cases, and a former US Senator, among others.

If you want to speak with a CFTC, IRS, or SEC whistleblower lawyer, or with a white collar defense lawyer, you can call the Firm at 347-746-1222.

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