Monsanto logo is displayed on a screen where the stock is traded on the floor of the New York Stock Exchange (NYSE) in New York City, U.S. on May 9, 2016. REUTERS/Brendan McDermid/File Photo
A former Monsanto Co (MON.N) executive who tipped the U.S. Securities and Exchange Commission to accounting improprieties involving the company's top-selling Roundup product has been awarded more than $22 million from the agency's whistleblower program, the executive's lawyer said on Tuesday. The award of $22,437,800 was tied to an $80 million settlement between the SEC and Monsanto in February, according to the lawyer, Stuart Meissner in New York, in a statement. It is the agency's second largest under the program. Meissner declined to reveal the whistleblower's identity. A Monsanto representative could not be immediately reached for comment. The Dodd Frank financial reform law empowered the SEC to award money to whistleblowers who give information to the agency which leads to a fine. Awards to 33 whistleblowers by the SEC's program have now surpassed a total of $107 million since the agency launched the program in 2011, the agency said in a statement on Tuesday. The largest award, in 2014, was $30 million, the agency said.
Monsanto's $80 million SEC settlement followed allegations that the company misstated its earnings in connection with Roundup, a popular weed killer. The SEC's case against Monsanto revolved around a corporate rebate program designed to boost Roundup sales. The SEC had said that Monsanto lacked sufficient internal controls to account for millions of dollars in rebates that it offered to retailers and distributors. It ultimately booked a sizeable amount of revenue, but then failed to recognize the costs of the rebate programs on its books. That led the St. Louis-based agriculture company to "materially" misstate its consolidated earnings for a three-year period.
Monsanto neither admitted nor denied the charges and said at the time that it fully reserved funds to pay for the penalty in fiscal year 2015. The SEC announced the award earlier on Tuesday, but did not reveal the enforcement action to which it was linked or the whistleblower's identity.
“Company employees are in unique positions behind-the-scenes to unravel complex or deeply buried wrongdoing. Without this whistleblower’s courage, information, and assistance, it would have been extremely difficult for law enforcement to discover this securities fraud on its own,” said Jane Norberg, Acting Chief of the SEC’s Office of the Whistleblower, in a statement. The award represents more than 28 percent of the total penalty and nearly the 30 percent maximum allowed under the SEC's bounty program for payments higher than $1 million, Meissner said.
(Reporting by Suzanne Barlyn; Editing by Steve Orlofsky, Bernard Orr)
This article was first seen on Reuters