The Dodd-Frank Act1 amended the Exchange Act2 by, among other things, adopting
Section 21F,3 entitled “Securities Whistleblower Incentives and Protection ” Section
21F directs the Commission to make monetary awards to eligible individuals
who voluntarily provide original information that leads to successful Commission
enforcement actions resulting in monetary sanctions over $1 million and successful
related actions 4
Awards must be made in an amount equal to 10 to 30 percent of the monetary
sanctions collected 5 To ensure that whistleblower payments would not diminish
the amount of recovery for victims of securities law violations, Congress established
a separate fund, called the Investor Protection Fund (Fund), from which eligible
whistleblowers are paid
The Commission established OWB, an of ce within the SEC’s Division of Enforcement
(Enforcement), to administer and effectuate the whistleblower program It is OWB’s
mission to administer a vigorous whistleblower program that will help the Commission
identify and halt securities frauds early and quickly to minimize investor losses
In addition to establishing an awards program to encourage the submission of high-
quality information, Dodd-Frank and the Commission’s implementing regulations
(Whistleblower Rules)6 prohibit retaliation by employers against employees who report
possible wrongdoing based on a reasonable belief that a possible securities violation has
occurred, is in progress, or is about to occur 7
In adopting the Whistleblower Rules, the Commission recognized that whistleblower
reporting through internal compliance procedures can enhance the Commission’s
enforcement efforts in appropriate circumstances 8 Consequently, the Commission
adopted strong incentives and protections for employees who choose to work within
their company’s own compliance structure because they believe that the employer’s
internal compliance function is an effective mechanism to address any potential
wrongdoing 9
Section 21F,3 entitled “Securities Whistleblower Incentives and Protection ” Section
21F directs the Commission to make monetary awards to eligible individuals
who voluntarily provide original information that leads to successful Commission
enforcement actions resulting in monetary sanctions over $1 million and successful
related actions 4
Awards must be made in an amount equal to 10 to 30 percent of the monetary
sanctions collected 5 To ensure that whistleblower payments would not diminish
the amount of recovery for victims of securities law violations, Congress established
a separate fund, called the Investor Protection Fund (Fund), from which eligible
whistleblowers are paid
The Commission established OWB, an of ce within the SEC’s Division of Enforcement
(Enforcement), to administer and effectuate the whistleblower program It is OWB’s
mission to administer a vigorous whistleblower program that will help the Commission
identify and halt securities frauds early and quickly to minimize investor losses
In addition to establishing an awards program to encourage the submission of high-
quality information, Dodd-Frank and the Commission’s implementing regulations
(Whistleblower Rules)6 prohibit retaliation by employers against employees who report
possible wrongdoing based on a reasonable belief that a possible securities violation has
occurred, is in progress, or is about to occur 7
In adopting the Whistleblower Rules, the Commission recognized that whistleblower
reporting through internal compliance procedures can enhance the Commission’s
enforcement efforts in appropriate circumstances 8 Consequently, the Commission
adopted strong incentives and protections for employees who choose to work within
their company’s own compliance structure because they believe that the employer’s
internal compliance function is an effective mechanism to address any potential
wrongdoing 9