A Monsanto whistleblower who accused his former employer of multiple years of accounting violations will receive a $22 million reward from the Securities and Exchange Commission (SEC). The award represents the second largest in the history of the SEC’s whistleblower program, created in 2011 as part of the Dodd-Frank legislation.

News of the substantial whistleblower reward comes several months after Monsanto reached an agreement with the federal government to settle accusations related to the company’s rebate program for Roundup weed killer, a widely-used glyphosate herbicide that has been linked to cancer.

According to the SEC, Monsanto failed to properly account for tens of millions of dollars in rebates the company provided to retailers and distributors when tabulating sales of Roundup weed killer. The alleged accounting violations started in 2009 and continued through 2011.

At that time, the economy was challenged by recession and Roundup was losing market share to cheaper generic versions of the herbicide. Realizing that Roundup sales were lower than the company projected, Monsanto altered its accounting policies, according to the Monsanto whistleblower.

Rather than factor in the costs of the rebates into the fiscal year for 2009, Monsanto reported the costs of the rebates in the next fiscal year. As a result of the alleged accounting violations, the company was able to meet consensus earnings-per-share analyst estimates for fiscal year 2009. Meeting this benchmark was very important to the company. If the company reported earnings that failed to meet estimates, Monsanto’s share price likely would have taken a hit.

In 2010, Monsanto allegedly used the same accounting, moving the costs of rebates into fiscal year 2011. According to the Monsanto whistleblower, over the course of 2009 and 2010, Monsanto’s accounting violations inflated the company’s profit by a combined total of $31 million.

Not long after the SEC began investigating Monsanto in late 2011, the company announced it would restate its earnings for 2009 and 2010 to reflect the true timing of the rebate costs. The impact of the restated earnings only caused the company’s stock to go down a few pennies per share, according to the New York Times, but Monsanto was forced to pay the government $80 million in penalties. Monsanto did not admit to any wrongdoing, but the company agreed to retain a qualified independent ethics and compliance consultant, per the terms of the government settlement.

Monsanto Whistleblower: The Punishment Doesn’t Fit the Crime

Despite the large penalty and whistleblower reward, the man who brought these allegations against Monsanto to the government’s attention believes that the punishment didn’t go far enough to address the issues that led to the alleged wrongdoing.

“The company got fined and some money changed hands, but that’s not the answer,” says the Monsanto whistleblower, who chose to remain anonymous, a choice that whistleblowers can make in filing a complaint with the SEC. The unidentified Monsanto whistleblower chose not to disclose his identity because he doesn’t want his involvement in this case to jeopardize any future job opportunities.

“Management not being held accountable, that still bothers me. I went into this to get that fixed, and that didn’t get fixed.”

He told the Times that it was difficult to know that the company was doing something wrong, but nobody seemed particularly bothered by it. “The Monsanto culture is very tightknit. Everybody has stock options and everyone is financially at risk. So they go with the flow.”

Only three mid-level Monsanto employees were named in the SEC’s enforcement action. Between all three, they paid a total of only $135,000 in penalties. One of the employees retired from Monsanto while the other two remain with the company as accountants.

This was particularly frustrating for the Monsanto whistleblower, who claims that others at the company knew about the alleged accounting violations, but the SEC took no action against them. It was also disappointing that the SEC chose not to pursue any action against Monsanto’s outside auditor, Deloitte, which allegedly enabled Monsanto to overstate earnings in 2009 and 2010. The SEC never provided any explanation as to why action against Deloitte was not pursued.

For its part, the SEC is beginning to pursue more cases against auditors. In 2013, the agency brought actions against 37 auditors. That number more than doubled in 2015.

SEC acting chief Jane Norberg commended the Monsanto whistleblower in a statement, saying his position within the company was the key to uncovering the alleged fraud, which she described as “deeply buried.” Without his participation, Norberg said it would have been extremely difficult for law enforcement to find out about the alleged wrongdoing.

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