SEC. 922. WHISTLEBLOWER PROTECTION.
(a) IN GENERAL.—The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended by inserting after section 21E the following:
SEC. 21F. SECURITIES WHISTLEBLOWER INCENTIVES AND PROTECTION.
(a) DEFINITIONS.—In this section the following definitions shall apply:
(1) COVERED JUDICIAL OR ADMINISTRATIVE ACTION.—The term ‘covered judicial or administrative action’ means any judicial or administrative action brought by the Commission under the securities laws that results in monetary sanctions exceeding $1,000,000.
(2) FUND.—The term ‘Fund’ means the Securities and Exchange Commission Investor Protection Fund.
(3) ORIGINAL INFORMATION.—The term ‘original information’ means information that—
(A) is derived from the independent knowledge or analysis of a whistleblower;
(B) is not known to the Commission from any other source, unless the whistleblower is the original source of the information; and
(C) is not exclusively derived from an allegation made in a judicial or administrative hearing, in a governmental report, hearing, audit, or investigation, or from the news media, unless the whistleblower is a source of the information.
(4) MONETARY SANCTIONS.—The term ‘monetary sanctions’, when used with respect to any judicial or administrative action, means—
(A) any monies, including penalties, disgorgement, and interest, ordered to be paid; and
(B) any monies deposited into a disgorgement fund or other fund pursuant to section 308(b) of the Sarbanes- Oxley Act of 2002 (15 U.S.C. 7246(b)), as a result of such action or any settlement of such action.
(5) RELATED ACTION.—The term ‘related action’, when used with respect to any judicial or administrative action brought by the Commission under the securities laws, means any judicial or administrative action brought by an entity described in subclauses (I) through (IV) of subsection (h)(2)(D)(i) that is based upon the original information provided by a whistleblower pursuant to subsection (a) that led to the successful enforcement of the Commission action.
(6) WHISTLEBLOWER.—The term ‘whistleblower’ means any individual who provides, or 2 or more individuals acting jointly who provide, information relating to a violation of the securities laws to the Commission, in a manner established, by rule or regulation, by the Commission.
(b) AWARDS.—
(1) IN GENERAL.—In any covered judicial or administrative action, or related action, the Commission, under regulations prescribed by the Commission and subject to subsection (c), shall pay an award or awards to 1 or more whistleblowers who voluntarily provided original information to the Commission that led to the successful enforcement of the covered judicial or administrative action, or related action, in an aggregate amount equal to—
(A) not less than 10 percent, in total, of what has
been collected of the monetary sanctions imposed in the
action or related actions; and
(B) not more than 30 percent, in total, of what has
been collected of the monetary sanctions imposed in the
action or related actions.
(2) PAYMENT OF AWARDS.—Any amount paid under paragraph
(1) shall be paid from the Fund.
(c) DETERMINATION OF AMOUNT OF AWARD; DENIAL OF
AWARD.—
(1) DETERMINATION OF AMOUNT OF AWARD.—
(A) DISCRETION.—The determination of the amount
of an award made under subsection (b) shall be in the
discretion of the Commission.
(B) CRITERIA.—In determining the amount of an
award made under subsection (b), the Commission—
(i) shall take into consideration—
(I) the significance of the information provided
by the whistleblower to the success of the
covered judicial or administrative action;
(II) the degree of assistance provided by the
whistleblower and any legal representative of the
whistleblower in a covered judicial or administrative
action;
(III) the programmatic interest of the
Commission in deterring violations of the securities
laws by making awards to whistleblowers who
provide information that lead to the successful
enforcement of such laws; and
(IV) such additional relevant factors as the
Commission may establish by rule or regulation;
and
(ii) shall not take into consideration the balance
of the Fund.
(2) DENIAL OF AWARD.—No award under subsection (b)
shall be made—
(A) to any whistleblower who is, or was at the time
the whistleblower acquired the original information submitted
to the Commission, a member, officer, or employee
of—
(i) an appropriate regulatory agency;
(ii) the Department of Justice;
(iii) a self-regulatory organization;
(iv) the Public Company Accounting Oversight
Board; or
(v) a law enforcement organization;
(B) to any whistleblower who is convicted of a criminal
violation related to the judicial or administrative action
for which the whistleblower otherwise could receive an
award under this section;
(C) to any whistleblower who gains the information
through the performance of an audit of financial statements
required under the securities laws and for whom such
submission would be contrary to the requirements of section
10A of the Securities Exchange Act of 1934 (15 U.S.C.
78j–1); or
(D) to any whistleblower who fails to submit information
to the Commission in such form as the Commission
may, by rule, require.
