US Regulator CFTC Grants $9 Million Award to Whistleblower

The Commodity Futures Trading Commission (CFTC CFTC The 1974 Commodity Exchange Act (CEA) in the United States created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud, and abuse trade practices and promotes fairness in futures contracts. The CEA also included the Sad-Johnson Agreement, which defined the authority and responsibilities for the monitoring of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commiss The 1974 Commodity Exchange Act (CEA) in the United States created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud, and abuse trade practices and promotes fairness in futures contracts. The CEA also included the Sad-Johnson Agreement, which defined the authority and responsibilities for the monitoring of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commiss Read this Term) recently announced that it had granted an award of around $9 million to a Whistleblower Whistleblower A whistleblower is an individual who manages to provide information or activity within a private or public organization that is deemed illegal, unethical, or not correct. In many countries, including the United States, whistleblowers are protected by law and in some cases can even recoup rewards if their information leads to successful prosecution.In the context of the financial services industry, whistleblowers play a large role in oversight, helping unmask several episodes of illicit behavior A whistleblower is an individual who manages to provide information or activity within a private or public organization that is deemed illegal, unethical, or not correct. In many countries, including the United States, whistleblowers are protected by law and in some cases can even recoup rewards if their information leads to successful prosecution.In the context of the financial services industry, whistleblowers play a large role in oversight, helping unmask several episodes of illicit behavior Read this Term, one of the five largest awards granted as part of the regulator’s Whistleblower Program.

The US watchdog said in a statement on Monday that it granted the award after the whistleblower gave it a specific, credible, and timely tip. This led to the Commission opening an investigation and ultimately bringing a successful enforcement action.

The specific details regarding the whistleblower’s tip and which company or person/s it related to have been redacted from available court documents. The regulator also does not provide any information in which individuals or entities are related in its statement.

Commenting on the case, CFTC Director of Enforcement James McDonald said in the statement: “We recognize that often whistleblowers come forward to report misconduct at great personal and professional risk. Cases like this serve as a reminder that the Whistleblower Program can reward that courage in a very real way, helping to soften the blow of any adverse consequences those whistleblowers might face.”

SEC and CFTC grant big awards to Whistleblowers

Although being a whistleblower is not without its risks, it can be lucrative. As Finance Magnates reported, in June, the Securities and Exchange Commission (SEC) awarded a tipster $50 million after the information provided resulted in “a successful enforcement action” and returned “a significant amount of money” to harmed investors.

At the time, the reward was the largest ever awarded by the SEC and easily surpassed the previous record of $39 million, which was set back in 2018. In July of 2018, the CFTC awarded $30 million to a whistleblower, which, at the time, was the largest ever amount granted to a single whistleblower since its program began.

“Whistleblowers like the individual receiving the award today provide a valuable public service,” added Whistleblower Office Director Christopher Ehrman in the statement. “We encourage others to come forward with information regarding possible violations in the markets the CFTC oversees.”