Last week, the Securities and Exchange Commission awarded a confidential whistleblower the highest sum to date for reporting on a fraudulent hedge fund that had bilked moneys from hundreds of investors. The amount received by the whistleblower was $14 million.
While the name of the whistleblower was not revealed and no information about the financial fraud released, it has become known that the whistleblower was reporting on a hedge fund and that the sums of moneys involved were quite substantial.
The award itself was large but not as large as some of the amounts soon to be awarded, according to sources close to the SEC. This is exactly what the agency is hoping would occur as information on major fraud is hard to come by and usually only revealed by those close to the wrongdoers.
A whistleblower who reveals primary and unique information to the SEC may be entitled to receive between 15-30% of what the government recovers and still maintain the secrecy of their identity. The way it works is the information is provided through counsel without having to reveal names or identities of the source. That’s the way Congress wrote the law and that is providing incentive along with larger rewards. Stay tuned.