The Securities and Exchange Commission announced its highest-ever Dodd-Frank whistleblower awards, with two whistleblowers sharing a nearly $50 million award and a third whistleblower receiving more than $33 million. The previous high was a $30 million award in 2014. Reports claim the three had reported alleged misconduct by Merrill Lynch, owned by Bank of America, which settled claims in 2016 that it used customer cash for trades that should have been kept in reserve accounts.

High-quality information

'These awards demonstrate that whistleblowers can provide the SEC with incredibly significant information that enables us to pursue and remedy serious violations that might otherwise go unnoticed,' said Jane Norberg, chief of the SEC’s Office of the Whistleblower. 'We hope that these awards encourage others with specific, high-quality information regarding securities laws violations to step forward and report it to the SEC.'

Investment protection fund

The SEC has awarded more than $262 million to 53 whistleblowers since issuing its first award in 2012.  All payments are made out of an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators.  No money has been taken or withheld from harmed investors to pay whistleblower awards. Whistleblower awards can range from 10 percent to 30 percent of the money collected when the monetary sanctions exceed $1 million. As with this case, whistleblowers can report jointly under the meand share an award. By law, the SEC protects the confidentiality of whistleblowers and does not disclose information that might directly or indirectly reveal a whistleblower’s identity.