The SEC just paid a record $114 million to a whistleblower.
The SEC fiercely protects the identifies of whistleblowers, which means we may never know who received the record-setting award of $114 million, or what misconduct he or she helped uncover.
Lately, it's been a particularly lucrative time to be a whistleblower.
The SEC handed out 39 individual whistleblower awards totaling about $175 million during the fiscal year that ended in September. That's more than in any year since the agency's whistleblower office launched in 2011. And the SEC received a record number of tips last year about potential wrongdoing.
...
Since its first payment in 2012, the SEC has awarded a total of $676 million to 108 individuals. The awards are paid out of a pool of money financed entirely through fines the SEC collects, not taxpayer money.
Money and revenge can be motivating factors, too
The whistleblower program helps uncover shady activity by dangling a lucrative financial incentive for employees and investors who might otherwise stay quiet.
Awards range between 10% and 30% of the fines imposed in SEC actions that result from whistleblower tips. And under new rules, awards of $5 million or less -- which are the majority of rewards -- are presumed to get the maximum 30%.
And at times, revenge can also be a motivating factor.
"I've seen whistleblowers who have personal relationships with the wrongdoer and they report on them when the relationship goes sour," Norberg said.
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