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SEC Awards $14M To Whistleblower Posting Report Online

Most whistleblowers are keen to keep their activity concealed and private until the information becomes public. In an unusual twist, one whistleblower decided to publish a research report online detailing the fraudulent activity of a company and that of its CEO prior to notifying the SEC of the fraud.

Within days of sharing this information online, the whistleblower then shared the same information with the SEC. The individual was persistent in reaching out to SEC staff about this information. Their continued contact led to the SEC opening an investigation that resulted in a successful enforcement action. This whistleblower was an outsider, not an employee of the company.

Without admitting or denying the findings, the Company and its CEO consented to the SEC’s order that required the Company to pay restitution as well as other remedies Ultimately, defrauded investors saw the return of millions of their dollars.

In the SEC’s order for award, the Claims Review Staff (CRS) awarded $14 million to the first whistleblower but decided not to award to the second on procedural grounds. All submissions must be made to the SEC through the online portal, which the second claimant failed to do.

The claimant claimed that they were a principal author of the research report. But instead of submitting their information through the OWB’s online portal, the individual relied on social media notifications (including tweets on Twitter), media coverage and other dissemination as sufficient notification to the SEC. Under Exchange Act Section 21F(a)(6) and Rule 21F-2(a), the second claimant was not eligible to receive an award since they provided no information directly to the SEC through the online portal.

The Commission’s TCR System is primarily for keeping track of information submitted to the SEC from potential whistleblowers. It also requires individuals to declare under penalty of perjury that the information is true to the best of their knowledge.

Retaining Experienced SEC Whistleblower Attorneys

Whistleblowers help everyone by notifying authorities of conduct that harms the public, while also earning financial compensation for themselves. Hiring experienced SEC counsel will greatly increase your chances of the SEC initiating an investigation based on your information. If you wish to remain anonymous, you must be represented by an attorney, who will submit everything on your behalf.

Silver Law Group and the Law Firm of David R. Chase jointly have experienced SEC whistleblower lawyers, including a former SEC Enforcement attorney on the team, so you will always have guidance throughout the process. Our SEC whistleblower attorneys can help you if you have information regarding securities or investment fraud, violations of federal securities laws, false filings, market manipulation, or other misconduct. You must provide timely, credible, and original information or analysis in order to be eligible.

Contact us through our online form or at (800) 975-4345 for a consultation. Our attorneys work on a contingency fee basis. This means that it costs you nothing to hire us, and we collect our fees when you receive an SEC bounty. Because we get paid when you do, we have the incentive to help you collect the maximum award available.

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