CFTC Whistleblowers Awarded $15 Million
Wednesday, September 27, 2023
Whistleblower in the act of whistleblowing

On September 19, the U.S. Commodity Futures Trading Commission (CFTC) announced two separate whistleblower awards totaling $15 million. The awards were issued to two whistleblowers who voluntarily provided the agency with original information that led to separate enforcement actions.

Through the CFTC Whistleblower Program, qualified whistleblowers are entitled to awards of 10-30% of the funds collected by the government in the enforcement action aided by their whistleblowing. Since it was established in 2010, the program has paid out nearly $350 million in whistleblower awards.

“These awards illustrate the success of our whistleblower program,” said Ian McGinley, Director of the Division of Enforcement. “The program incentivizes whistleblowers like these two to come forward with accurate information, including evidence of ongoing misconduct, to help protect market participants and hold wrongdoers accountable.”

According to the CFTC, one of the newly awarded whistleblowers “interpreted key evidence and helped the Division of Enforcement (DOE) staff identify new and productive lines of inquiry.” The agency adds that “this whistleblower pointed staff to the misconduct at issue in the resulting enforcement action and provided information that conserved CFTC resources.”

The second whistleblower filed a Form TCR with the CFTC which quickly initiated an investigation into the alleged misconduct. Following the initial disclosure, the whistleblower “provided a high degree of additional support to DOE staff; including interpreting key evidence for staff; facilitating the appearance of another witness to corroborate the violations; and providing a declaration in support of the matter,” according to the CFTC.

“These whistleblowers provided sustained cooperation and support, which helped catch more misconduct and conserve CFTC resources,” said Whistleblower Office Acting Director Christina McGlosson. “Today’s awards show how whistleblowers can act as force multipliers for the CFTC’s enforcement efforts.”

The scope of misconduct that whistleblowers report to the CFTC is widespread. The agency’s whistleblower office stated in its report for the 2022 fiscal year that the program received tips and complaints regarding activities including but not limited to record keeping or registration violations, illegal swap dealer business conduct, solicitation, misappropriation, insider trading, and other types of fraud, use of deceptive or manipulative devices in trading, as well as spoofing, and other forms of disruptive trading or market manipulation.

While the CFTC Whistleblower Program has been remarkably successful, recovering over $3 billion from fraudsters, it is currently facing a funding crisis threatening to undermine the program.

Geoff Schweller also contributed to this article.


NLR Logo

We collaborate with the world's leading lawyers to deliver news tailored for you. Sign Up to receive our free e-Newsbulletins


Sign Up for e-NewsBulletins