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Comment by kyleee | Hacker News Reader

No meaty details, anyone have more info?

That’s the beauty of this program. No one will know who was responsible. Whistleblowers can now safely report crimes without repercussions.

You can now get rich sniffing out Madoff type scams before they blow up to billions raised.

> You can now get rich sniffing out Madoff type scams before they blow up to billions raised.

Madoff was non-anonymously reported to the SEC several times for running an obvious scam. Why would anonymous reporting make a difference?

A whistleblower is someone with inside knowledge, often enough on it's own to convict, those non-anonymous reports didn't contain that info.

A person meeting that description would not be "sniffing out" anything.

godzillabrennus probably meant "snuff out". Let's not get hung up on that bit.

they would be helping the SEC sniff it out though.

I think this is a new program set up in the aftermath of those widely publicized scandals during (or shortly previous) to the financial crisis in the late 2000s

Shouldn’t the caught party be identified and what the illegal scheme was?

It feels like the public should at least know that, if not the whistleblower.

The SEC talks about their enforcement actions all the time: https://www.sec.gov/news/pressreleases Pretty much every week there's a "$COMPANY pays $MILLIONS to settle charges" announcement, so these aren't being swept under the rug.

The important point is that there's no way to link which whistleblower award comes from which enforcement. The public doesn't need to know this.

How often are criminal charges laid and and disclosed, or is this more of a cost of doing business type of thing?

Note that the SEC cannot press criminal charges, but they can send evidence to a federal prosecutor (e.g. the United States Attorney for the Southern District of New York) who can initiate criminal cases. They also like to advertise their cases: https://www.justice.gov/usao-sdny/pr?f%5B0%5D=field_pr_topic...

Sometimes those details are enough to identify the informant, or for someone with enough sleuthing skills.

For funsies, I once figured out a confidential informant in a DoJ investigation. There was enough info because they were running a business in a niche field in a state not known for it. Didn't act on it in anyway.

Depending on the definition of "informant", that would have been illegal[1] (according to this source).

[1] https://www.robertreeveslaw.com/blog/doxing-arrested/

Was wondering that myself, but didn't see any benefit to telling anyone even if it were legal.

Based on your link, it seems like publishing their ID would be illegal. But if a reporter called them up and interviewed them without publishing identity, no law would be broken. Not legal advice.

Yes, I was unclear.

> that would have been

I meant to say "publishing would have been" illegal.

I think there's some nuance here. It's not illegal to know that someone is an informant, you just can't publish their information.

The SEC reaches out to the company to let them know they are considering an investigation (Wells Notice) and then decides if they want to do an investigation after they confirm issues.

Then they settle with the companies.

If settlement is large enough, whistleblower gets paid some too.

As the whistleblower is not the accuser in the civil charge, the company doesn't get to know who it was.

This was my initial thought too, but reflecting, I think at least part of the reason they aren't naming the guilty party here is to protect the identity of the whistle blower. If you could reason from knowledge of the guilty party whom the whistle blower is, knowing they just got an $8.3 million payout, it just might be worth your time to go after said whistle blower. I don't think it's unreasonable that someone could figure that out.

I wonder what goes through the whistleblowers head in terms of timing and how much they should help the crime. If you wait a little longer or help the crime, the payout increases. Maybe there are already people designing schemes in which they can do the crime, whistleblow, and get a legal payday.

You risk getting beaten to the punch by someone else...

What happens if the whistleblower turns out to be one of the accomplices in the fraud who decides to turn against his co-conspirators?

They can not face retaliation for the whistleblowing, but can be held accountable for their crimes.

Sounds like it depends on how early/quickly you turn coat.

I haven’t worked on an SEC case but your typical Federal whistleblower suit prosecuted by the DOJ remains under seal until the government decides whether to intervene (in the legal sense, meaning becoming a party to the case). I doubt a pre-intervention settlement would automatically unseal it, particularly if the settlement is confidential.

It would be highly unethical report any such details if we did know them, as it would lead to retaliation against a protected witness.

That's the whole point of the program.

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