HomeCFTC Issues $10 Million Whistleblower Award

CFTC Issues $10 Million Whistleblower Award

Geoff Schweller

On March 18, the U.S. Commodity Futures Trading Commission (CFTC) issued a whistleblower award of approximately $10 million to an individual whose disclosure led the agency to open an investigation. The whistleblower’s information was utilized at the earliest stages of the investigation and the whistleblower later provided supplemental information. 

Through the CFTC Whistleblower Program, qualified whistleblowers, individuals who voluntarily provide original information that leads to a successful enforcement action, are entitled to an award of 10-30% of the funds collected by the government.

“This award demonstrates the continued success of the CFTC’s Whistleblower Program,” said Acting Director of Enforcement Vincent McGonagle. “The CFTC is committed to rewarding whistleblowers who identify misconduct in our markets.”

“The CFTC has granted a number of multimillion-dollar whistleblower awards to date,” added Whistleblower Office Director Christopher Ehrman. “These large awards are putting market participants on notice that whistleblowers continue to provide significant information to the Commission.”

The CFTC has awarded approximately $330 million since issuing its first award in 2014. In October 2021, the agency issued a record $200 million award.

“The CFTC whistleblower program continues to be a tremendous success,” stated whistleblower attorney Stephen M. Kohn of Kohn, Kohn & Colapinto. “Congress needs to fully fund this critical anti-corruption program that brings in billions of dollars in sanctions.”

As Kohn references, funding has proven to be an issue for the CFTC Whistleblower Program. The funding issue was outlined by Senator Charles Grassley (R-IA) in letters to CFTC nominees. “Because of its great success,” he wrote, “the whistleblower fund is at risk of being depleted.” Grassley further explained that ‘the increasing size and quantity of fines arising from successful whistleblower disclosures have led to larger reward disbursements. Current law requires that the whistleblower fund be capped at $100 million, and any fines collected past the cap are remitted to the Treasury’s general fund. The disbursement of larger rewards from a capped fund poses an impending threat to the CFTC whistleblower program’s ability to fuction.”

After months of lobbying by whistleblower advocates, President Biden signed an amended version of the bipartisan CFTC Fund Management Act into law on July 6, 2021. The law saved the CFTC Whistleblower Program from financial collapse by temporarily establishing a separate fund to finance the operations of the program. According to whistleblower advocates, however, further longer-term reforms are needed to ensure the long-term success of the program.

Latest News & Insights

  • June 29, 2022

    On June 28, leading whistleblower attorney Stephen M. Kohn addressed over 15 international delegates at the Meridian International Center’s speaker series on Transparency and Accountability in Government. The attendees came from N ...

  • June 22, 2022

    On June 22, the U.S. House Committee on Financial Services voted unanimously by voice to approve H.R. 7195, a bill amending the whistleblower provisions of the Anti-Money Laundering Act of 2020 (AML Act). The AML Act established a ...

  • June 22, 2022

    This article was originally published in JD Supra. On June 21, the U.S. Supreme Court granted certiorari in United States, ex rel. Polansky v. Executive Health Resources, Inc. The Court agreed to hear the case which concerns the i ...

  • June 14, 2022

    On June 10, the Internal Revenue Service (IRS) Whistleblower Office released its Fiscal Year 2021 Annual Report. In Fiscal Year 2021 (FY 2021), which ran from October 1, 2020 - September 31, 2021, the IRS Whistleblower Program col ...

Subscribe for News & Resources

Our content is crafted and curated by the partners and associates at KKC.