The Commodity Futures Trading Commission (CFTC) has awarded a whistleblower about $1.25m for reporting on misconduct – the first whistleblower award of the year.
The whistleblower first reported the problem to their employer, but no meaningful remedial action was taken, so the issue was reported to the CFTC.
“Insiders have some of the most valuable evidence about illegal activity in our markets,” said Ian McGinley, Director of the Division of Enforcement. “Today’s award recognizes the risks they take in coming forward to the CFTC, as well as the role of their information in amplifying the CFTC’s enforcement efforts.”
“[The] Program rewards employees with compliance and audit responsibilities who first raise violations internally and then contact the CFTC if the employer sits on its hands.”
Brian Young, Director of the Whistleblower Office
The award is also the first under the CFTC’s 120-day safe harbor provision, within which a whistleblower serving within either the entity’s internal compliance or audit function needs to wait at least 120 days before contacting the Commission.
Photo: CFTC
“The whistleblower first reported internally, fulfilling job duties and putting the entity on notice of its wrongdoing,” said Brian Young, Director of the Whistleblower Office. “The CFTC’s Whistleblower Program rewards employees with compliance and audit responsibilities who first raise violations internally and then contact the CFTC if the employer sits on its hands.”
Young started his role as Director on February 15. Previously he was at the Department of Justice, where he served as the acting director of litigation for the Antitrust Division and oversaw criminal prosecutions brought under the Sherman Act, as well as civil merger and antitrust conduct litigation.
“Leads generated from insiders are critically important to any financial enforcement program.The tremendous accomplishments of the CFTC’s Whistleblower Program confirm this view. I look forward to working with and learning from the talented CFTC staff to combat wrongdoing,” Young said.
Awards totalling over $366m
Since 2014, the CFTC has awarded whistleblowers more than $366m.
The biggest award to date was issued in 2021, when one whistleblower was awarded $200m for information that contributed to an already open investigation and resulted in successful CFTC enforcement action, along with two related actions by a US federal regulator and by a foreign regulator. This outsized payout meant that 2021 was also the year that saw the largest combined awards total of $204m.
| Year | Number of whistleblowers | Amount |
|---|---|---|
| 2024 | 1 | $1.25 |
| 2023 | 4 | $33.3m |
| 2022 | 7 | $11.125m |
| 2021 | 4 | $204m |
| 2020 | 12 | $18.25m + ‘undisclosed’ further awards |
| 2019 | 7 | $16m |
| 2018 | 3 to 5* | $75.07m |
| 2017 | – | – |
| 2016 | 2 | $10.05m |
| 2015 | 1 | Approximately $290,000 |
| 2014 | 1 | Approximately $240,000 |
The largest number of awards were paid out in 2020, with six awards going to 12 whistleblowers.
The awards range between 10 and 30% of the monetary sanctions collected, are paid from the CFTC’s Customer Protection Fund, and are financed entirely through monetary sanctions paid to the CFTC by violators of the Commodity Exchange Act.