Last week, the Securities and Exchange Commission announced yet another whistleblower award.  According to the SEC, the award totals more than $5.5 million dollars.  Tellingly, we don't, and won't, know the exact amount.  The headline to the SEC's press release pegs the number at $5.5 million while the order itself reads:

Claimant shall receive an award of [Redacted] percent [Redacted] of the monetary sanctions collected in this Covered Action, including any monetary sanctions collected after the date of this Order.

We, the public, will never know the exact amount, the company involved, the nature of the action, or the relationship, if any, of the whistleblower to anyone at the SEC.

The SEC's order is less than 400 words in length, even counting the multiple instances of "redacted".  Given the dearth of any details, the SEC's claim that "no money has been taken or withheld from harmed investors to pay whistleblower awards" is questionable at best.  The SEC must collect the sanctions money from somewhere.  If the SEC collects it from a company, how can it be said that the money isn't being taken, at least indirectly, from the stockholders?  Is it really the SEC's position that stockholders aren't "harmed" by corporate malfeasance?

According to the SEC, it has now awarded $142 million.  That is a great deal of money for a governmental agency to be handing out in virtual secrecy to an extremely small number of whistleblowers.  The SEC's whistleblower program is perhaps too new to be tainted by scandal.  However, the large sums of money being handed out under a cloak of secrecy provide a solid substrate for future malversation.