US Regulator Reports Rise in Whistleblower Tips in Fiscal 2014

The US Securities and Exchange Commission received 3,620 tips from whistleblowers in fiscal year 2014, the largest number received since the programme went into effect three years ago.

According to the SEC's report, the agency received 3,238 in fiscal 2013. Fiscal 2014, which ended September 30, marked a record year for the SEC's programme, both in terms of the number of tips received and the amounts it awarded tipsters.

"The incentives on offer are so large that lawyers will agree to represent whistleblowers on a contingency basis. This means it’s a lot easier to be a whistleblower, because you’re not dealing with the regulators, your lawyer is," says Adam Siegel, co- head of global investigations practice and US managing partner at Freshfields Bruckhaus Deringer.

The SEC said it also got tips from outside the United States, with the bulk of those coming from the United Kingdom (70, up 6% from 2013), India (69, up 28% from 2013), Canada (58, down 6% from 2013), the People’s Republic of China (32, down 38% from 2013), and Australia (29, up 93% from 2013).

The UK continues to be the biggest originator of whistleblowing complaints to the SEC outside of the US with a 6% increase in 2014.

Freshfields senior associate John Warren adds, "It’s important for multi-national corporations to be aware that this is far from an exclusively US issue. The SEC has an ever-expanding geographic reach, with tips received from 60 different countries.

Whistleblowers in China and India placed in the top four globally (together with the UK and Canada) in terms of total number of tips received."

Whistleblower tips by allegation type: 

Corporate Disclosures and Financials (610, up 9% from 2013)

Offering Fraud (581, up 5% from 2013)

Manipulation (563, up 7% from 2013)

Insider Trading (256, up 30% from 2013)

Trading and Pricing (144, down 14% from 2013)

FCPA (159, up nearly 7% from 2013)

Unregistered Offerings (102, down 3% from 2013)

Market Event (139, up 56% from 2013)

Municipal Securities Public Pension (58, up 20% from 2013) 


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