The Commodity Futures Trading Commission (CFTC) established a whistleblower reward program in 2010 under the Dodd-Frank Wall Street Reform and Consumer Protection Act to encourage those aware of commodity law violations to notify the CFTC.
How the CFTC whistleblower reward program works
- The CFTC provides whistleblower awards of between 10 percent and 30 percent of the monetary sanctions collected by a CFTC action or a related action, if more than $1 million is collected as a result of the whistleblower's information,
- To qualify for a reward, the whistleblower must be the first to submit the information.
Job protection for CFTC whistleblowers
- Whistleblowers may submit information to the CFTC anonymously, provided that an attorney represents them.
- In every case, whether the whistleblower submitted the information anonymously or not, the CFTC will keep the identity of the whistleblower confidential.
- CFTC whistleblowers may receive protection against employer retaliation. The Dodd-Frank Act prohibits employers from firing, demoting, suspending, threatening, harassing, or discriminating against whistleblowers who provide information to or assist the CFTC.
- Whistleblowers who suffer from employment retaliation as a result of their whistleblowing may sue for reinstatement, back pay and any other damages that occurred.
The CFTC welcomes whistleblowers from countries around the world. You need not reside in the United States or be a citizen of the United States to submit information or receive an award.
Significant CFTC enforcement actions
The CFTC has in recent years gained greater visibility in enforcement actions in the financial and commodities markets. Among the most significant are:
- Foreign currency rate manipulation: The CFTC and counterpart agencies have fined numerous banks -Barclays, JP Morgan and UBS, among others - for the attempted manipulation of foreign currency benchmark rates. Over $10 billion in fines has been collected in both civil and criminal actions involving foreign exchange (Forex or FX) rate manipulation.
- Inter-bank interest rate manipulation. The CFTC has imposed fines of nearly $2.7 billion on 6 banks - including Deutsche Bank, Barclays, and Royal Bank of Scotland - and 2 interdealer brokers for manipulation of LIBOR, Euribor, and other interest rate benchmarks.
- "London Whale" credit default swap manipulation. The CFTC fined JP Morgan $100 million for employing manipulative tactics in the trading of credit default swaps (CDS).
The CFTC recently paid out its largest ever whistleblower reward, signaling its commitment to the whistleblower program. The $10 million award was paid to a whistleblower whose original information about violations of the Commodity Exchange Act (CEA) led to a successful enforcement action.
Phillips & Cohen has experience representing whistleblowers in cases involving complex financial transactions and fraud in commodities markets. We have filed many whistleblower claims with the CFTC under the Dodd-Frank whistleblower reward program and are working closely with enforcement officials on a number of them.
We represented a whistleblower who was awarded more than $30 million under the SEC whistleblower reward program - the largest reward made under the Dodd-Frank whistleblower programs - for his help and that of Phillips & Cohen exposing and stopping a massive securities fraud.
If you are aware of any fraud in commodities markets, or violations of commodities laws, and would like to discuss your options under the CFTC whistleblower program, please contact Phillips & Cohen to discuss the matter at no charge.