February 13, 2024
The Securities and Exchange Commission (SEC) reported a record-breaking year for the SEC Whistleblower Program in 2023. In addition, fiscal year 2023 saw a significant uptick in SEC enforcement actions. In a year marked by evolving challenges such as crypto asset securities, cybersecurity threats, and emerging investor schemes, the SEC remained vigilant in regulating securities markets and protecting investors.
The SEC initiated 784 enforcement actions in 2023, a 3% increase over fiscal year 2022. Of those, 501 were original investigations also called “stand-alone” actions. The SEC filed 162 “follow-on” administrative proceedings against individuals subject to criminal convictions or injunctions. In connection with the enforcement actions, the SEC barred 133 individuals from serving as officers or directors of public companies, the highest number of officer and director bars obtained in a decade.
The SEC also saw a surge in enforcement actions related to crypto asset securities and cybersecurity breaches. Furthermore, the SEC cracked down on the sale of unregistered offerings and fraudulent schemes. It also held social media influencers accountable for touting securities without adequate disclosures.
In fiscal year 2023, the SEC secured orders for $4.949 billion in financial remedies, the second-highest amount in its history. Of this amount, $3.369 billion represented disgorgement and prejudgment interest and $1.580 billion was in civil penalties. Both the disgorgement and civil penalties ordered were the second highest amounts on record.
In addition, the SEC returned $930 million to harmed investors in fiscal year 2023. This marks the second consecutive year with more than $900 million in distributions to victims.
The SEC reported the second consecutive record-breaking year for its Whistleblower Program. The SEC received a record-breaking 18,000 tips from whistleblowers in fiscal year 2023. This is nearly 50 percent more than the then-record 12,300 whistleblower tips received in fiscal year 2022.
Further, the SEC Whistleblower Program issued a record-breaking $600 million to whistleblowers in fiscal year 2023. A single whistleblower received a landmark $279 million award. This program’s success highlights its pivotal role in detecting and deterring securities violations.
Whistleblower Law Collaborative LLC, based in Boston, devotes its practice entirely to representing clients nationwide in bringing actions under the federal and state whistleblower laws and programs, False Claims Acts and other whistleblower programs. The Whistleblower Law Collaborative has secured awards for clients in several SEC whistleblower cases, including a $17 million award to one whistleblower.
If you are considering submitting a tip, complaint, or referral to the SEC or are aware of other types of fraud, contact us for a free, confidential consultation.