Here’s what you need to know about the CFTC’s whistleblower program and how you can report wrongdoing in your company and obtain a substantial cash reward.
A Brief History Of The CFTC’s Whistleblower Program
The CFTC was created when Congress, responding to the Ponzi schemes and other securities and investments violations of the past several years, enacted the Dodd-Frank Act.
The new program provided incentives to commodity futures traders and other investment traders and brokers who come forward with verifiable evidence of fraud and other offenses. It also provides two significant protections for whistleblowers:
- Confidentiality. The CFTC will not publicly share the whistleblower’s identity and will try to keep the person and their information confidential. There are times when the Commission must disclose information, however, such as during the discovery phase of a trial or public proceeding.
- Anti-Retaliation. The Dodd-Frank Act prohibits employers from retaliating against employees who file claims of securities or CEA violations.
If a company retaliates against an employee, such as by firing them, either the employee or the CFTC may bring a civil action against the employer for CEA violations.
Types Of Commodity Futures Trading Violations
The CFTC’s Division of Enforcement investigates alleged CFTC and CEA violations. Offenses can include futures, swaps, and options involving a “contract of sale of any commodity in interstate commerce.” Some common types of CFTC violations include:
- Trade practice violations, such as wash sales, noncompetitive sales, fictitious sales, and others.
- Market manipulation, such as using “illicit trading strategies” to manipulate prices, or “spoofing,” which is entering an order and immediately canceling it before it registers as completed.
- Fraud, including mishandling or misrepresenting customer funds, engaging in Ponzi and other investment schemes, and falsifying customer account statements, among others.
The CFTC regularly investigates claims of misconduct and routinely works with criminal and regulatory authorities throughout the country.
How Can I Get A Reward For Being A CFTC Whistleblower?
As an employee at a commodity futures trading company, you have a first-row seat into the inner workings of your company and your industry. The CFTC appreciates this, and will offer you a reward if you voluntarily submit information that leads to a major discovery of wrongdoing and substantial recovery to duped customers. The CFTC’s whistleblower program provides two kinds of monetary rewards:
- Monetary awards to anyone who provides information about CFTC or CEA violations that result in $1 million or more in monetary sanctions.
- Monetary awards to anyone who provides information leading to “successful enforcement of an action brought by the CFTC.”
The total award a whistleblower can receive is between 10% and 30% of the amount the CFTC recovers after its investigation. When multiple whistleblowers act together to provide the information, each receives a share of the award.
How Do I Report A CFTC Violation?
If you’re a company insider in commodity futures trading and have information on market manipulation, fraud, trade practice violations, or any other serious wrongdoing, you likely have many questions and concerns about reporting what you know. You may worry about your employer finding out and retaliating against you, or you might be anxious to submit the most complete and compelling report possible outlining what you know.
The Silver Law Group and the Law Firm of David Chase have created a strategic alliance to represent CFTC whistleblowers like you. Our CFTC whistleblower team, which includes an SEC enforcement lawyer, has an in-depth understanding of the CFTC whistleblower program. We know what the CFTC is looking for and can help you submit a tip that is more likely to result in a successful covered action. We’re here to help whistleblowers maximize their opportunity to receive a financial bounty.
Contact us by email or call us today at (800) 975-4345 for a free consultation.