It's only been a little over a year since the Securities and Exchange Commission (SEC) launched its Office of the Whistleblower, but it has already received almost 3,000 securities law violation tips.
In a speech this week, Sean X. McKessy, chief of the Office of the Whistleblower, said the SEC receives an average of eight tips a day, "rather than the avalanche of poor quality, frivolous tips that were predicted."
The Office of the Whistleblower was formed as part of the Dodd-Frank Act in 2010.
"As we considered the contours of the rules to implement the Whistleblower program, we heard repeatedly that the implementation of this program would overwhelm the commission and literally shut our program down," McKessy said, addressing the inaugural Securities Enforcement Forum in Washington, D.C. on Thursday. "We also heard that corporate compliance departments that had been built out as a result of Sarbanes-Oxley, would no longer be able to function."
As of Aug. 8, 2012, McKessy said the office had received received 2,820 tips from people in the U.S. and from at least 45 countries.
Last year, McKessy said the SEC has "already seen an increase in the quality of the tips we have received since the passage of Dodd-Frank in July 2010."
The SEC has said only one award has been paid. In August, a whistleblower who did not want to be identified received a payment of almost $50,000 for helping a court demand more than $1 million in sanctions in a securities fraud case.