On November 14, the U.S. Securities and Exchange Commission (SEC) announced its enforcement results for the 2023 Fiscal Year. In addition to obtaining orders for $4.949 billion in financial remedies, the SEC awarded nearly $600 million to whistleblowers, a fiscal year record.
The SEC Whistleblower Program’s record fiscal year also included the single largest whistleblower award ($279 million) and the most whistleblower tips received in a single year (18,000).
“Year after year, the SEC Whistleblower Program continues to build on its immense success,” said whistleblower attorney Stephen M. Kohn of Kohn, Kohn & Colapinto. “The information and assistance provided by whistleblowers play an integral role in the Commission’s enforcement results.”
“It is no coincidence that as the SEC issues more and more whistleblower awards it also receives more and more whistleblower tips,” added Kohn. “These awards incentivize insiders to come forward and report misconduct, bolstering the Commission’s enforcement efforts and in turn protecting the American public from fraud.”
During the 2023 Fiscal Year, the SEC filed 784 total enforcement actions covering a wide range of securities law violations. The Commision highlights that FY 2023 was a successful year for enforcement efforts relating to crypto asset securities, Environmental, Social and Governance (ESG) issues, as well as whistleblower protection.
“As the SEC continues to increase its enforcement efforts in emergent areas such as crypto and ESG, the SEC Whistleblower Program will play a key role in the success of these efforts,” said Kohn.
“The investing public benefits from the Division of Enforcement’s work as a cop on the beat,” said SEC Chair Gary Gensler. “Last fiscal year’s results demonstrate yet again the Division’s effectiveness—working alongside colleagues throughout the agency—in following the facts and the law wherever they lead to hold wrongdoers accountable.”
“Investor protection and enhancing public trust in our markets requires that we work with a sense of urgency, using all the tools in our toolkit. As today’s results make clear, that’s precisely what the Enforcement Division did in fiscal year 2023,” said Gurbir S. Grewal, Director of the Division of Enforcement. “Whether it was by leveraging risk-based initiatives, seeking robust remedies, rewarding cooperation, protecting whistleblowers, or returning nearly a billion dollars to harmed investors, the Enforcement Division stood up for the investing public. I am extremely proud of the Division’s efforts, including those that are not directly reflected in today’s results like the many important investigations that may not result in enforcement actions or the thousand-plus ongoing investigations teams conduct each fiscal year – all of which help protect investors, hold bad actors accountable, and promote public trust.”
This article was authored by Geoff Schweller.