Articles Tagged with whistleblower reward

The whistleblower which I featured in yesterday’s blog who was awarded $30 million by the Commodities Futures Trading Commission for blowing the whistle on JPMorgan Chase, will also receive an additional $48 million from the Securities and Exchange Commission. That means he will receive $78 million!  His name is Edward Siedle and he is  a former lawyer for the Securities and Exchange Commission, now turned forensic investigator, who alerted the SEC to the bank’s wrongdoing. Prior to this, Mr. Siedle, investigated  pension funds for overcharging beneficiaries, alerted regulators of a mutual fund scam being run by JPMorgan Chase in 2011, The Post has learned.

The larger part of his whistleblower award comes from  a $267 million settlement between JPMorgan and the SEC, which investigated the bank for steering high-net-worth clients toward its own investment funds that could cost more than those managed by rivals. The CFTC joined the investigation because some of the JPM investment products involved commodities. The bank agreed to pay $100 million to settle the CFTC probe. Siedle said he has filed about two whistleblower suits a year since the program started, and has no immediate plans for the award.

–Jeffrey A. Newman

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.

Banner Health has agreed to pay the United States over $18 million to settle allegations that 12 of its hospitals in Arizona and Colorado knowingly submitted false claims to Medicare by admitting patients who could have been treated on a less costly outpatient basis, the Justice Department announced today.  Headquartered in Arizona, Banner Health owns and operates 28 acute-care hospitals in multiple states. The settlement resolves allegations that 12 Banner Health hospitals knowingly overcharged Medicare patients unnecessarily.  In particular, the United States alleged that from Nov. 1, 2007 through Dec. 31, 2016, Banner Health billed Medicare for short-stay, inpatient procedures provided at the 12 hospitals that should have been billed on a less costly outpatient basis.  The settlement also resolves allegations that Banner Health inflated in reports to Medicare the number of hours for which patients received outpatient observation care during this time period.

Banner Health also entered into a corporate integrity agreement with the U.S. Department of Health and Human Services – Office of Inspector General (HHS-OIG) requiring the company to engage in significant compliance efforts over the next five years.  Under the agreement, Banner Health is required to retain an independent review organization to review the accuracy of the company’s claims for services furnished to federal health care program beneficiaries. This settlement resolves a lawsuit filed in the U.S. District Court for the District of Arizona by Cecilia Guardiola, a former employee of Banner Health, under the qui tam or whistleblower provisions of the False Claims Act, which permit private citizens to bring lawsuits on behalf of the United States and obtain a portion of the government’s recovery.  Guardiola will receive roughly $3.3 million.  The case is captioned United States ex rel. Guardiola v. Banner Health and NCMC, Inc. No. 2:13-cv-02443.

Jeffrey Newman represents whistleblowers

 Americanflag-300x175
The Securities and Exchange Commission announced its largest-ever whistleblower awards,  $83 million combined going to three whistleblowers who helped the agency reach a $415 million settlement with  Bank of America Corp according to an SEC statement and a lawyer representing the whistleblowers. That 2016 settlement was the SEC’s second-biggest against a Wall Street bank. As part of the agreement, Bank of America resolved accusations that it misused customer cash and securities to generate profits, putting billions of dollars of customer assets at risk over a roughly six-year period.
The SEC, in keeping with its usual practice, didn’t specify Monday which settlement the whistleblower awards were connected to. But Jordan Thomas, a partner at Labaton Sucharow LLP who advises corporate whistleblowers, said he represented the three award recipients cited anonymously in the SEC announcement. Two recipients together were awarded roughly $50 million and another about $33 million.

Mr. Thomas confirmed that the whistleblowers provided original information to the SEC that helped the regulator in its investigation.An SEC spokesman declined to comment.

whistleblower-reward-300x210
Furniture merchant, turned whistleblower Kelly Renee Wells of Alabama, will receive nearly two million dollars for revealing revealed that larger retailers were evading import tariffs on furniture made in China by misclassifying the bedroom furniture as living room or hall furniture in order to evade “dumping” duties. One of the companies she sued, Bassett Mirrors, Inc.  just settled the claims against it for $10.5 Million. Last year, its co-defendant Z Gallerie of California settled its case for $15 million. Federal prosecutors intervened in the cases against Bassett and Z Gallerie but have not intervened in the two co-defendants left, Neiman Marcus and Macy’s. Ms. Wells was the source of information for both companies that settled.

Ms. Wells Attorney, Page Pate, says that he intends on pursuing Macy’s on his own for whistleblower Wells. The duties imposed by the U.S. Commerce Department are designed to protect domestic manufacturers from Chinese manufacturers who were dumping wooden bedroom furniture into the U.S. market. The case is part of a much larger picture involving extensive tariff evasion concerning Chinese goods including the dumping of honey some of this is adulterated by sweeteners and antibiotics not approved by the FDA. Thousands of barrels of fake honey is being transshipped from China through Taiwan and other countries with false documents in order to evade dumping duties.

The Department of Justice stated in its announcement of the settlement against Z Gallerie in April 2016 that it resolved allegations that Z Gallerie evaded antidumping duties on wood bedroom furniture imported from China from 2007-1014 by misclassifying or conspiring with others to misclassify the imported furniture as pieces intended for non-bedroom use on documents presented to Customs and Border Protection.

whistleblower1-300x218
Whistleblower Beverly Brown has received a  award of more than $78 million for her efforts in obtaining a $280 million False Claims Act settlement against Celgene Corporation. The  reward and settlement amounts are among the largest ever to date.y. The False Claims Act allows whistleblowers  to bring suit in the name of the government against individuals or entities that caused the fraudulent or improper expenditure of government funds. If the case is successful, the relators receive a portion of the government’s recovery, known as a “relator share.”

Beverly Brown is a former Celgene sales representative who filed suit against Celgene saying that the company illegally promoted two of its drugs – Thalomid and Revlimid – for uses that were not approved by the FDA and also that Celgene paid illegal kickbacks to healthcare providers and others  to increase the sales of its drugs. After the suit was filed, the case remained under seal for four years while the government investigated.

The case was then heavily  litigated  including a review of millions of documents, numerous discovery motions, 40 fact and expert depositions, and dozens of pre-trial motions.

money-award-300x169
The Securities and Exchange Commission (SEC) announced that a whistleblower has earned an award of more than $1 million for providing the SEC with new information and substantial corroborating documentation of a securities law violation by a registered entity that impacted retail customers.

Today’s award reflects the impact that whistleblower information can have in uncovering violations that harm the retail investor,” said Jane Norberg, Chief of the SEC’s Office of the Whistleblower. “We welcome high-quality information about potential securities-law violations from those in and outside a company.

More than $162 million has been awarded to 47 whistleblowers. By law, the SEC protects the confidentiality of whistleblowers and does not disclose information that might directly or indirectly reveal a whistleblower’s identity. 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.

An employee for the Department of Education revealed fraud involving federal student financial aid programs and forced payment of $58 million dollars to the government for which he will receive over $16.5 million dollars himself. The whistleblower Dr. Jonathan Oberg fought the case alone, as the Department of Justice declined to intervene. The allegations included claims that the companies, including Nelnet Inc, created billing systems that allowed them to inflate subsisides fromt the Department of Education.

Cheryl Eckard was paid $96 million, the largest amount ever received by a whistleblower. She reported violations in the Glaxo Puerto Rico facility. Pills were being made with incorrect doses and some of the drugs were contaminated. The whistleblower tried to convince the plant executives to fix the problems before she reported it.