SEC Issues Annual Report on Dodd-Frank Whistleblowing Program: 3,001 Tips, One Award

| Zuckerman Spaeder Team

As of now, SEC whistleblowers have a one-in-3,001 chance of receiving a whistleblower award.  That’s according to the latest annual report from the SEC’s Office of the Whistleblower, which was established to administer the whistleblower bounty program established by the Dodd-Frank Act of 2010.

We’ve previously covered the only award made to date under the whistleblower program – a $50,000 payout, nearly 30% of what the SEC recovered in that particular case.  But what we didn’t know at the time was how many tips had actually been made to the SEC by potential whistleblowers. 

Now, thanks to the annual report, we know: the SEC received 3,001 separate “Form-TCRs,” which can be submitted by fax, mail, or online.  (That number includes only the TCRs that requested treatment under the whistleblower bounty program; the SEC received additional TCRs that did not include that request).  The SEC’s annual report also breaks out the categories of the complaints.  Leading the charge was “Corporate Disclosures and Financials,” followed by “Offering Fraud,” and “Manipulation.” 

A whistleblower becomes eligible for an award when an action results in monetary sanctions exceeding $1 million.  At that point, the SEC posts a “Notice of Covered Action,” letting the whistleblowers know it’s time to apply for an award.  According to the annual report, in the 2012 fiscal year, the SEC posted 143 such notices.  It is still reviewing and processing applications for awards that it received as a result of those notices, so those who are on the wrong side of the one-in-3,001 ratio need not give up hope just yet.

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