On June 24, 2019, the Commodity Future Trading Commission (CFTC) announced an award of approximately $2.5 million to a whistleblower who assisted in an enforcement action against Cargill Inc.
This award evidences the importance that the CFTC places on reliable whistleblowers who prove to be essential resources in combating corporate misconduct. Without the whistleblower’s valuable information, this investigation, like many others, would remain unresolved.
This particular award emphasizes the criticality that the CFTC places on reporting time-sensitive information. Here, the whistleblower provided specific, credible and important information to the CFTC; however, because of an unreasonable delay in reporting, the CFTC reduced the total amount awarded. The CFTC explains that a failure to report a violation in a timely manner can lead to additional financial loss to customers or the general public. On the other hand, early reporting lessens the harm violators can inflict on the public and hastens the investigations that bring culprits to justice. Because timeliness is such a critical factor to the success of an investigation, a whistleblower’s award is closely related to the timing of his initial report to the CFTC.
The CFTC’s whistleblower’s program was created under Section 748 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. Under the Act, the CFTC awards individuals who voluntarily provide information that is sufficiently specific, credible, timely, and that results in successful enforcement action. This information can be anything from documents, statements, or analyses that are useful to the CFTC’s investigation.
The CFTC’s whistleblower program is an important tool for regulators to discover and prevent ongoing violations of the federal securities laws. Experienced counsel can help guide an CFTC whistleblower through the process and help maximize a recovery.
Silver Law Group is a nationally-recognized securities law firm headquartered in South Florida representing investors worldwide with their claims for losses due to securities and investment fraud. The firm has successfully recovered multi-million dollar awards for its clients through securities arbitration and the courts. To contact Scott L. Silver to discuss your legal matter, call toll-free (800) 975-4345 or e-mail him at SSilver@silverlaw.com.