On January 14, 2021, the SEC issued an Order Determining Whistleblower Award Claims (the “Order”). The Order grants “Claimant 1” a $600,000 award while completely denying any award to “Claimant 2.” The heavily-redacted Order makes it impossible to determine what Covered Action and monetary sanction triggered the claims for a Whistleblower Award. You can quickly tell when reading the Order, however, that things are not going to go well for Claimant 2 when the commission notes early on in the Order that:
“Enforcement staff responsible for the Covered Action confirmed that they did not receive any information from Claimant 2, nor did they have any communications with Claimant 2, before or during the investigation.”
Claimant 2’s theory, we learn, is that his tip did not have to be communicated directly to the Enforcement Staff responsible for the Covered Action. It turns out that Claimant 2 provided information about a company to Enforcement Staff in an entirely different regional office. An investigation was commenced and Enforcement Staff was unable to substantiate Claimant 2’s claims. The investigation was closed without commencement of an enforcement action. The Commission pointedly defines the redacted company as the (“Unrelated Company”) and the investigation as the (“Unrelated Investigation”).