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CFTC seeks money laundering info from whistleblowers

CFTC money laundering whistleblower

A CFTC enforcement official said the agency wants whistleblowers to help it fight money laundering.

The Commodity Futures Trading Commission is encouraging whistleblowers with information about money laundering to come forward, according to remarks by an agency enforcement official at a conference last week in Washington, D.C.

The CFTC is pursuing money laundering under its authority to fight fraud involving the commodity futures markets. Commodity futures take a wide number of forms, ranging from contracts on tangible items such as oil and gas to contracts on financial products, including foreign exchange benchmarks and LIBOR.

One item that is sometimes overlooked as a commodity, however, is money. Because money laundering amounts to an unlawful use of a commodity, it falls squarely within the CFTC’s authority.

The CFTC oversees the anti-money laundering programs of registered futures commission merchants, introducing brokers, commodity pool operators and commodity trading advisors.  Entities registered with the CFTC must implement anti-money laundering policies and procedures to prevent and identify unlawful transactions.

The agency intends to put its authority to good use. In addition to enforcing compliance with anti-money laundering programs, the CFTC wants to use its civil authority to bring cases directly against individuals and companies who violate currency laws.

This new approach could have a big impact on the CFTC’s whistleblower program, which to date has paid over $10.5 million in whistleblower rewards, with more awards on the way. The growing success of the program should encourage additional whistleblowers exposed to money laundering and other fraudulent schemes to coming forward to report what they know.

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