What “related actions” might qualify for an SEC whistleblower cash award?

Under the SEC whistleblower program, “related actions” are judicial or administrative proceedings brought by specifically designated government authorities. They include federal criminal prosecutors, other civil regulators, and self-regulatory organizations such as FINRA or national stock exchanges.

Eligibility for an award in an SEC enforcement action is a prerequisite for any award in a related action. For a whistleblower to obtain a related action award, there must be both a successful SEC enforcement action and a successful action brought by a qualifying authority.

The non-SEC enforcement action must also be based on the same original information that the whistleblower provided to the SEC. To recover, a whistleblower must show that the same information that was provided to the SEC was provided to the other enforcement authority and that the information directly contributed to the other authority’s investigative and litigation efforts, leading to the success of that authority’s enforcement action.

Where those conditions are met, a whistleblower will be entitled to recover on the amount obtained through the related action.

If another agency has a whistleblower program that could pay an award in connection with a “related action,” then the whistleblower must decide which award to pursue. The whistleblower cannot receive two awards in connection with a single “related” action. Pursuit of an award from the SEC for such an action waives the whistleblower’s right to receive any other potential award.  

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