Offering tips and other information about fraudulent and illegal financial transactions earned an anonymous tipster $30 million from the Security and Exchange Commission. The payment seeks to encourage other people to offer leads on fraudulent activities. 

The $30 million offer sounds a tad bit gratuitous, but the scheme reportedly provides useful information for the SEC. The agency is willing to dole out a large sum of money to similar individuals who can help discover an ongoing "difficult to detect" fraud. The payment is also now part of the organization's initiative to encourage people to report illegal or spurious financial and business activities. 

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Fortunately, it has been effective. 

SEC Enforcement Director Andrew Ceresney shared that "this record-breaking award sends a strong message about our commitment to whistleblowers and the value they bring to law enforcement." 

SEC is granted the authority to take such measures following the 2010 Dodd-Frank Wall Street Reform period. The organization now has the prerogative to pay whistleblowers to curb financial crimes and other fraudulent conducts. Previously, SEC can only offer financial rewards to insider trading tipsters. 

Despite expanding the reach of the initiative, the program is still considered limited. SEC can only settle the payment to the whistleblower if the information provided would be enough to merit more than $1 million in sanctions. The information should lead to enforceable actions. Otherwise, the payment is not applicable. 

Considering the amount of penalty the monetary reward applies, the $30 million offer is a standard. SEC refused to identify the person who leaked the crucial information. Ceresney merely commented that "this whistleblower came to us with information about an ongoing fraud that would have been very difficult to detect." 

In fact, the tipster may have been able to get more than $30 to $35 million if the report had been filed earlier. According to the Wall Street Journal, SEC decided to slash the reward because the person did not report the misconduct the first time he discovered the illegalities. The reward to the international tattletale suggests that non-U.S. residents can also gain big rewards from the ongoing bounty program.

TagsSecurities and Exchange Commission, SEC reward