Articles Tagged with Securities & Exchange Commission

The Securities and Exchange Commission today announced a whistleblower award of more than $2.1 million to a former company insider whose information led to multiple successful enforcement actions.  The whistleblower’s information strongly supported the findings in the underlying actions and the whistleblower provided ongoing assistance to the staff during the investigation. “The SEC has issued nearly $90 million in whistleblower awards in the past month alone,” said Jane Norberg, Chief of the SEC’s Office of the Whistleblower.  “As these awards demonstrate, we continue to receive high-quality information from whistleblowers, which we use to detect and prosecute securities violations and safeguard investors.”

Since issuing its first award in 2012, the SEC has awarded more than $266 million to 55 individuals under the whistleblower program.  In that time, almost $1.5 billion in monetary sanctions have been ordered against wrongdoers based on actionable information received from whistleblowers, including more than $740 million in disgorgement of ill-gotten gains and interest, the majority of which has been or is scheduled to be returned to harmed investors.

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. Whistleblowers may be eligible for an award when they voluntarily provide the SEC with original, timely, and credible information that leads to a successful enforcement action.  Whistleblower awards can range from 10 percent to 30 percent of the money collected when the monetary sanctions exceed $1 million.



SeaWorld Entertainment  was subpoenaed by the Justice Department over an investigation about disclosures made concerning the ‘Blackfish’ documentary impact and trading in the securities of the company. The investigation relates to public statements and the disclosures  made by the firm and some executives.  SeaWorld said that it had received subpoenas from both the Justice Department and the S.E.C., concerning “disclosures and public statements made by the Company and certain executives…on or before August 2014, including those regarding the mimpact of the “Blackfish” documentary and trading of the company’s securities…” The company was accused in the  2013 documentary Blackfish of abusing the captive killer whales that performed at its venues, charges it denied. In 2010, an orca named Tilikum killed its trainer, Dawn Brancheau, dragging her underwater and drowning her during a routine  at SeaWorld in Orlando, Fla. SeaWorld did not cooperated in the filming of “Blackfish” which described how Tilikum had killed three people. In 2013 following the release of the documentary, Seaworld was criticized . Animal rights activists argued that keeping the killer whales in small tanks was mistreatment as their natural environment is the open seas. Activists say the killer whales have a short lifespan when in captivity compared to those in the wild. When the ‘Blackfish’ documentary was  released, Seaworld  described the film as being a piece of propaganda that was emotionally manipulative, false and misleading.

SeaWorld was purchased in 2009 by the Blackstone Group, a private equity group.  Since the film Blackfish was presented, admission revenues have declined 11 percent since 2013, and attendance has fallen during that period. Last year, the company recorded a loss of $12.5 million on revenues of $1.34 billion. SeaWorld stopped paying its dividend last year, and in December announced a restructuring plan and layoffs to reduce costs. Besides the critcism by animal rights activists, SeaWorld is also facing a class-action lawsuit from some investors.

Jeffrey Newman represents whistleblowers