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SEC Whistleblower Lawyer Blog

CFTC Strengthens Whistleblower Protections By Withholding Award Amount

The Commodities Futures Trading Commission (CFTC) has announced a whistleblower award without revealing the dollar amount of the award in order to protect the whistleblower’s identity. The CFTC may be making a habit of withholding the amount of whistleblower awards. Whistleblower attorney Scott Silver calls it “An important additional step that insulates whistleblowers from being identified and facing personal and professional retaliation.” CFTC Whistleblower Award On September 4, 2020, the CFTC announced that a whistleblower provided a tip that helped to stop fraudulent activity that was harming investors. According to the CFTC’s website, their whistleblower program “provides monetary incentives to individuals who report possible violations of the Commodity Exchange Act that lead to a successful enforcement action, as well as privacy, and anti-retaliation protections for whistleblowers.”The Commodities Futures Trading Commission (CFTC) has announced a whistleblower award without revealing the dollar amount of the award in order to protect the whistleblower’s identity.

The CFTC may be making a habit of withholding the amount of whistleblower awards. Whistleblower attorney Scott Silver calls it “An important additional step that insulates whistleblowers from being identified and facing personal and professional retaliation.”

CFTC Whistleblower Award

On September 4, 2020, the CFTC announced that a whistleblower provided a tip that helped to stop fraudulent activity that was harming investors.

According to the CFTC’s website, their whistleblower program “provides monetary incentives to individuals who report possible violations of the Commodity Exchange Act that lead to a successful enforcement action, as well as privacy, and anti-retaliation protections for whistleblowers.”

The SEC and the CFTC both have whistleblower programs that pay whistleblowers who provide original non-public information that leads to a successful enforcement action. The award can be between 10% and 30% of the recovery.

The Dodd-Frank Act provides confidentiality protections and forbids retaliation against whistleblowers. However, companies that have had the whistle blown on them may search for the whistleblower and attempt retaliation. Many whistleblowers are insiders at financial institutions who provide ongoing support for investigations.

The CFTC and SEC publicize awards, which can be millions of dollars, to encourage whistleblowers to come forward. But they also want to protect whistleblower’s identities, and revealing award amounts could help to out the whistleblower.

In this recent case, the CFTC apparently decided that the risk of identifying the whistleblower was greater than the good publicity that could come from revealing the dollar amount of the award.

The CFTC’s whistleblower program is smaller than the SEC’s, having paid out $120 million compared to the SEC’s $500 million. The CFTC also issues fewer rewards in less time, which could make it easier to match an award with an enforcement action, potentially leading to the identification of and retaliation against the whistleblower.

The CFTC regulates the U.S. derivatives markets and has oversight of many different types of activities. The CFTC, in conjunction with the NFA, regulates many registered firms, commodities pool operators, hedge funds and others. The CFTC prosecutes a wide range of misconduct including claims of spoofing, precious metal fraud, mismanagement of customer funds, improper futures trading, and the swap and derivatives markets.

Explore Your Options With A CFTC Whistleblower Attorney

An individual may file a whistleblower claim on their own, but many prefer to do so with the help of an experienced attorney that can lead them through the process and give the best odds of collecting an award.

Our CFTC whistleblower attorneys assist insiders and investors around the country. We are ready to investigate the details of your situation and tailor a course of action to your needs and goals. Contact us at (800) 975-4345 or through our online form for a free consultation with a securities fraud attorney.

Our attorneys are prepared to assist your legal needs if you have information regarding securities fraud, financial crime, or other types of illegal conduct, which could lead to whistleblower complaint. Our invaluable experience in representing whistleblowers provides a unique advantage in assisting whistleblowers.

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