Today, the Acting Chairman of the Commodity Futures Trading Commission (“CFTC” or the “Commission”), Mark Wetjen, announced that the Commission will make its first payout to a whistleblower as part of its Whistleblower Program created by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”). In exchange for providing information about violations of the Commodity Exchange Act of 1936, the tipster will receive approximately $240,000.
In its press release, the Commission said that “the whistleblower provided specific, timely and credible information that led to the Commission bringing important enforcement actions.” The Commission did not provide any other information about the whistleblower or the total amount of the sanctions collected from these enforcement actions.
The CFTC’s Whistleblower Program provides that whistleblowers who voluntarily provide the Commission with original information about violations of the Commodity Exchange Act resulting in a $1 million or greater recovery are eligible to receive 10 to 30 percent of the monies collected.
The Director of the Commission’s Whistleblower Office expressed hope that this award “will send a strong message that the CFTC will pay for information that helps us do our jobs.” Accordingly, the Commission seeks to encourage whistleblowers to come forward with information that will lead to enforcement actions. Employers should continue to enhance their internal compliance programs and heighten the likelihood that employees will use them.
The CFTC has received far fewer whistleblower tips than the SEC’s Whistleblower Program, which is not surprising given the more limited scope of the CFTC’s regulatory authority. Earlier this year, the CFTC reported that it had received 58 whistleblower tips in 2012 and 138 in 2013. While this is the first whistleblower award paid out by the CFTC, we are likely to see the frequency of awards increase in the future as the CFTC continues to receive more tips.