Over the past week, the U.S. Securities and Exchange Commission has issued total rewards of over $20 million to three SEC whistleblowers. As a result, SEC enforcement actions involving whistleblowers have now recovered more than $1 billion in financial remedies against whistleblowers.
The SEC today announced an enforcement action against the Initial Coin Offering (ICO) by PlexCoin. The SEC obtained a freeze on the purportedly $15 million in investor funds raised by PlexCoin from thousands of U.S. and international investors since August.
Cryptocurrency, led by bitcoin, has become a hot topic in the mainstream media recently. Both the CME and Nasdaq have announced plans to introduce trading in bitcoin futures. And the investing community continues to be split between those who believe it is the future of currency and those who believe it is a bubble or, worse, a fraud, as Jamie Dimon called it in September.
The Justice Department has appealed a decision by the U.S. Tax Court last year to provide an IRS whistleblower reward based upon a criminal fine and civil forfeitures. The Government’s appeal to the D.C. Circuit attempts to reverse a favorable decision for whistleblowers on the definition of collected proceeds used in the terms of the IRS whistleblower program.
Ikea relaunched the recall of 29 million dressers and chests last week after a California toddler was found trapped underneath an Ikea Malm dresser and died in May. The recall was first announced in June 2016 and Ikea has reportedly already processed more than 1 million recalls.
We learned last week that the first settlement of claims in the government’s ongoing investigation of ties between pharmaceutical manufacturers and patient assistance programs happened in September when Aegerion Pharmaceuticals agreed to pay more than $35 million to resolve criminal charges and a civil False Claims Act lawsuit.
The CFTC has also issued its annual report to Congress on the Dodd-Frank Act whistleblower program during Fiscal Year 2017. The CFTC did not issue any whistleblower awards last year. However, it did amend the whistleblower rules and regulations through a period of public notice and comment rulemaking.
The annual SEC whistleblower report to Congress for Fiscal Year 2017 has been released. It provides information and data about the activities of the SEC Whistleblower Office (referred to in the report as OWB) from October 1, 2016 to September 30, 2017. Over the year period, the SEC received over 4,400 whistleblower tips during Fiscal Year 2017 and paid out awards totaling nearly $50 million. The SEC also brought a number of enforcement actions to address companies that unlawful retaliated against or impeded whistleblowers.
The Wisconsin Center for Investigative Journalism has estimated that the state of Wisconsin gave up $11 million when it weakened the Wisconsin False Claims Act and then repealed it as part of the 2015-2017 budget process.
This week, the SEC Enforcement Division issued its annual report on its enforcement actions in Fiscal Year 2017 and its priorities for the future.