CFTC Whistleblower Program

Elements of a Claim under the CFTC Whistleblower Program

To successfully file a claim under the CFTC Whistleblower Program, several key elements must be met:

1. Original Information: The whistleblower must provide original information not previously known to the CFTC, meaning it must be based on independent knowledge or analysis and not publicly available.

2. Violation of the Commodity Exchange Act: The information provided must relate to violations of the Commodity Exchange Act, such as fraud, market manipulation, insider trading, or other misconduct in the commodities and derivatives markets.

3. Significant Contribution: The information must lead to a successful CFTC enforcement action resulting in monetary sanctions of over $1 million. The whistleblower’s tip must significantly contribute to the enforcement or investigation process.

4. Timely Submission: The information must be submitted to the CFTC in a timely manner, ideally before public disclosure or government investigation of the misconduct.

5. Confidentiality: While the whistleblower can choose to remain anonymous if represented by an attorney, they must disclose their identity to the CFTC before receiving any reward.

6. No Disqualification: The whistleblower must not be involved in certain disqualifying activities, such as being a CFTC employee or having committed the violations themselves.

Meeting these elements is essential for a whistleblower to be eligible for financial rewards, which can range from 10% to 30% of the monetary sanctions collected by the CFTC.

The CFTC Whistleblower Program Process

The process for submitting a claim under the CFTC Whistleblower Program involves several key steps:

1. Submitting Information: A whistleblower must submit a tip to the CFTC using Form TCR (Tip, Complaint, or Referral). The information must be original and relate to violations of the Commodity Exchange Act, such as fraud, market manipulation, or insider trading.

2. CFTC Evaluation: Once submitted, the CFTC reviews and evaluates the whistleblower’s information to determine if it warrants further investigation. If the tip leads to an enforcement action, the whistleblower’s role and the quality of the information provided will be assessed.

3. Enforcement Action: For a whistleblower to qualify for a reward, the CFTC must take successful enforcement action based on the whistleblower’s information, resulting in monetary sanctions exceeding $1 million.

4. Submitting a Claim for Award: If an enforcement action occurs, the whistleblower must submit Form WB-APP (Application for Award) to the CFTC within 90 days of the CFTC posting a "Notice of Covered Action" on its website. This form officially initiates the process to claim a reward.

5. Determination of Award: The CFTC Whistleblower Office reviews the application and determines the award amount, which ranges from 10% to 30% of the total monetary sanctions collected. The size of the award depends on the significance of the information provided, the whistleblower’s cooperation, and other factors.

6. Confidentiality and Protections: Throughout the process, the CFTC protects the whistleblower’s identity and shields them from retaliation by employers. Whistleblowers can remain anonymous if represented by an attorney.

7. Appeal: If the whistleblower disagrees with the CFTC’s award decision, they may appeal the determination in federal court.

By following these steps, whistleblowers play a critical role in helping the CFTC enforce regulations and maintain the integrity of the commodities markets.

The CFTC Whistleblower Reward

The CFTC Whistleblower Reward offers financial incentives to individuals who provide original information that leads to a successful enforcement action by the CFTC resulting in monetary sanctions of over $1 million. Whistleblowers are eligible to receive a reward ranging from 10% to 30% of the total sanctions collected. The exact percentage awarded depends on several factors, including the significance of the information provided, the whistleblower’s cooperation, and the overall contribution to the case.

The CFTC Whistleblower Program is designed to encourage individuals to report violations of the Commodity Exchange Act, such as fraud or market manipulation, by offering substantial rewards. Additionally, whistleblowers are protected by confidentiality provisions and anti-retaliation laws, ensuring that they can come forward without fear of reprisal.

Key Features of the CFTC Whistleblower Program

The CFTC Whistleblower Program has several key features designed to encourage individuals to report violations of the Commodity Exchange Act:

1. Financial Rewards: Whistleblowers who provide original information leading to a successful enforcement action may receive 10% to 30% of the monetary sanctions collected, as long as the sanctions exceed $1 million.

2. Confidentiality: The program allows whistleblowers to report violations anonymously if represented by an attorney. The CFTC is committed to protecting the identity of whistleblowers throughout the process.

3. Anti-Retaliation Protections: Whistleblowers are legally protected from retaliation by employers. These protections ensure that whistleblowers cannot be demoted, fired, harassed, or otherwise penalized for reporting misconduct.

4. Broad Coverage: The program covers a wide range of violations under the Commodity Exchange Act, including market manipulation, fraud, and insider trading within the commodities and derivatives markets.

5. Global Participation: The program is open to both U.S. and non-U.S. citizens, allowing individuals from around the world to participate and receive rewards.

6. Appeal Rights: If a whistleblower disagrees with the reward determination, they have the right to appeal the decision in federal court.

These features make the CFTC Whistleblower Program a powerful tool for promoting transparency and accountability in the commodities and derivatives markets.