The bitterness and sweetness of a U.S. stock market “whistleblower”: after being squeezed out of revenge, he received 800 million bonuses and set a new record

  Original title: The bitterness and sweetness of a US stock market “whistleblower”: After being squeezed out and revenge, he received 800 million bonuses and set a new record

   China Times reporter Ma Xiaochao and Chen Feng report from Beijing

   Following June 4 this year , The US stock market “whistleblower” appeared two new historical records. One is that the bonus record awarded to a single “whistleblower” was refreshed to nearly 800 million yuan.

   The other is that in the 2020 fiscal year ending on September 30, the total amount of bonuses awarded by the US Securities and Exchange Commission or proposed to be awarded to “whistle blowers” set a new record.

   But unlike the disclosure on June 4, the SEC mentioned in the two latest announcements that the “whistleblower” suffered “suffering” because of the “whistle blowing”. The implication is that they were retaliated or excluded within the company. Liu Junhai, director of the Institute of Commercial Law of Renmin University of China, told the reporter of China Times that behind this phenomenon, there are common weaknesses of human nature, as well as the emotional entanglement of reporters. China’s capital market can also reflect and consider, which is very valuable. .

  The “sweetness” of sky-high bonuses

   On October 22, local time in the United States, the SEC stated in an announcement that it would reward a whistleblower with a $114 million bonus. This bonus The scale has set a new historical record. The previous record holder was a “whistleblower” who received $50 million in June this year.

   The 114 million US dollars this time consists of two parts. A part of approximately US$52 million was linked to the case reported by the “whistleblower”, and the SEC successfully carried out law enforcement with the assistance of the “whistleblower”.

  The other part is about 62 million US dollars. It is a few other cases derived from the above reported cases. The law enforcement agency is not the SEC.

  U.S. stocks “whistleblower” are often awarded sky-high bonuses, mainly due to two factors. The first is that the bonus amount is directly linked to the regulatory penalty. Specifically, if the administrative penalty for “whistle blowing” exceeds US$1 million, the “whistleblower” can get a minimum of 10% and a maximum of 30%; The second factor is that in order to ensure that “whistle blowers” are rewarded, the US Congress has established an independent fund called the “Investor Protection Fund.”

   In the 2020 fiscal year just after the end, the SEC’s annual “whistleblower” bonus scale has set a new historical record.

  According to the announcement on September 30, the SEC will award 39 “whistle blowers” in fiscal year 2020, with a total bonus of approximately US$175 million. Since the emergence of the first prize-winning “whistleblower” in 2012, as of September 30, 2020, 106 “whistleblowers” have been awarded, with a cumulative scale of US$562 million.

   has a history of more than 100 years in the United States, not only in the field of capital markets, but also in other industries, and even longer in comparison.

   “China Times” published a series of reports on the “whistleblower” system in U.S. stocks in 2019. It mentioned that in March 1863, during the administration of President Lincoln, he made ill-gotten wealth against arms dealer The “Declaration of Fraud Act” passed by the US Congress includes a “whistle blower” reward clause. This bill can be regarded as the modern beginning of the US “whistle blower” system.

   The early “whistle blowing” system in the United States mainly targeted illegal activities in the defense and military industry. It was not until the 1990s that it gradually expanded to other fields such as medical care and taxation, and issued a series of comparative A systematic bill, not a bill.

   The “Whistleblower” project for financial securities was established after the US financial crisis. Specific to the US stock market, the time point was in August 2011, when the SEC officially launched the “Whistleblower” reward and protection project.

  ’s early history and experience laid the foundation for the efficient operation of the “whistleblower” system in the capital market today.

  The “suffering” of being excluded from retaliation

   In the capital market, compared with reports by outsiders, the “whistle blowing” of insiders can increase the number of violations that are exposed and confirmed. Probability.

   But the willingness of insiders to “blow the whistle” is usually difficult to stimulate due to some special reasons. U.S. stocks offering sky-high bonuses to “whistleblowers” can be regarded as a measure to stimulate willingness.

   While the outside world envied the “whistleblower” who received hundreds of millions of bonuses, the “suffering” of the “whistleblower” seemed to be concealed. For example, in the October 22 announcement, Jane Norberg, director of the SEC’s “Whistleblower” office, mentioned that this “whistleblower”, who was awarded nearly 800 million yuan, was “whistling” to the SEC. In the past, he has reported many times within the company and suffered “suffering personal relationships and work.”

   In addition, in the September 30 announcement, the SEC also mentioned that some “whistleblowers” ​​have suffered “suffering” when reporting within the company. The implication is that these “whistleblowers” have been retaliated or excluded because of “whistle blowing”.

   Before the “whistleblower” “whistle” to the SEC, they should report the problem to the relevant senior management within the company. This is a special feature of the US stock market “whistleblower” system.

   The relevant regulations of the SEC have released signals that encourage “whistleblowers” ​​to report violations of laws and regulations to the company’s internal disciplinary committee first. For example, a reporter from China Times combed its relevant terms and rules and found that the corresponding terms include: first, the whistleblower voluntarily takes the lead in reporting to the company’s internal disciplinary department, and may share a higher percentage of fines than reporting directly to the SEC; Second, the whistleblower will voluntarily report to the company’s internal disciplinary department, and the company will eventually notify the SEC. The whistleblower will also be identified as a qualified “whistleblower” and share the due bonus; third, the whistleblower will first voluntarily report to the company The internal disciplinary department reports and reports to the SEC at the same time within 120 days, and the resulting fines will also be distributed to the “whistleblower” in proportion.

   To this end, the SEC has also set up a mechanism for implementing “anti-retaliation” enforcement actions against “whistleblower” actions.

   But now, it seems that the existence of the “anti-retaliation” mechanism in US stocks can reduce the chance of an insider being expelled from the company after “whistle blowing”, but it still cannot avoid “whistleblower”. “The occurrence of relatively secretive situations such as being squeezed out by colleagues afterwards.

   And the existence of this phenomenon will inhibit the willingness of insiders to “whistle.” Even if the reported boss or colleague violates laws and regulations, the reporter may still be alienated or excluded from his colleagues, triggering a feeling of “traitor”. It is not surprising that this situation may occur in any contemporary country.

   Liu Junhai told the reporter of China Times that there may be the common weakness of human beings. A person has a concept of right and wrong, but sometimes he may hope that the people around him will be loyal to him and legal justice. Sometimes it is consistent with Jianghu loyalty, and sometimes it is contradictory. For example, listed companies or financial institutions are falsified. Insiders report this to protect public investors. It is righteousness. Choosing confidentiality for colleagues or friendship is a small righteousness. , How to choose, different people may have different answers.

  Editor: Yan Hui Chief Editor: Xia Shencha

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