CFTC hands out $10 million to a whistleblower, total payouts top $330 million

abdelaziz Fathi

The US Commodity Futures Trading Commission awarded $10 million to a whistleblower whose “original information” led the CFTC to open an investigation.

According to the agency’s order, one whistleblower received the regulatory bounty for information and assistance that led the staff to open the investigation into “hard-to-detect violations.” He was the initial source that alerted the CFTC to a previously unknown conduct and thereafter provided assistance that helped substantially advance investigations. Specifically, he gave useful information at the earliest stages of the investigation and later provided supplemental information.

“This award demonstrates the continued success of the CFTC’s Whistleblower Program. The CFTC is committed to rewarding whistleblowers who identify misconduct in our markets. The CFTC has granted a number of multimillion-dollar whistleblower awards to date,” added Whistleblower Office Director Christopher Ehrman. “These large awards are putting market participants on notice that whistleblowers continue to provide significant information to the Commission,” said Acting Director of Enforcement Vincent McGonagle.

CFTC issues a record-setting $200 million award

Committed to protecting the anonymity of informants, neither the tipster nor the firm accused of misconduct were identified by the regulatory agency.

Earlier in October, the CFTC announced an award of nearly $200 million to a whistleblower who provided assistance that led to a successful CFTC’s enforcement action, as well as two related actions spanning different countries, one by another unidentified US federal agency and a third action by a foreign regulator.

The insider had provided information that helped these regulators’ probes that led to roughly $3.0 billion in settlements and monetary sanctions. The $200 million is the largest amount ever awarded under the CFTC’s whistleblower program and far surpasses the next-largest award of $100 million made to an individual in July 2021.

The whistleblower could even get a higher bounty as he submitted a payout claim in connection with a third related action by a state regulator. However, his request was denied because the tips he provided was never shared with that state regulator.

The US regulators consider several factors in determining the size of whistleblower awards. As long as their internal disclosure prompted a company investigation, they can benefit from all the information discovered in that investigation.

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