The Securities and Exchange Commission announced a whistleblower award of more than $2.2 million, the first paid under the “safe harbor” rule.

The former company insider’s actions follow the Exchange Act Rule 21F-4(b)(7), which provides that if a whistleblower submits information to another federal agency and submits the same information to the SEC within 120 days, the SEC will treat the information as though it had been submitted to the SEC at the same time that it was submitted to the other agency.

After the whistleblower voluntarily reported information to another federal agency covered by the rule, which referred the matter to the SEC, the agency opened an investigation. Within 120 days of the initial report, the whistleblower provided the same information to the SEC and later provided “substantial cooperation” in the investigation, which led to enforcement action.

“Whistleblowers, especially non-lawyers, may not always know where to report, or may report to multiple agencies,” said Jane Norberg, chief of the SEC’s Office of the Whistleblower, in a statement. “This award shows that whistleblowers can still receive an award if they first report to another agency, as long as they also report their information to the SEC within the 120-day safe harbor period and their information otherwise meets the eligibility criteria for an award.”

Since issuing its first award in 2012, the SEC has awarded more than $264 million to 54 whistleblowers. The payments are made out of an investor protection fund established by Congress and financed entirely through monetary sanctions paid to the SEC by securities law violators.

For more information about the whistleblower program and how to report a tip, visit here.

SEC whistleblower program tips

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Danielle Lee

Danielle Lee

Danielle Lee, managing editor of Accounting Today, previously served as technology editor of Accounting Today and editor-in-chief of Accounting Technology.