United States: CFTC's Publication Of Largest Whistleblower Award Follows Increased Focus On Whistleblowing Initiatives

On April 4, 2016, the US Commodity Futures Trading Commission ("CFTC") announced the issuance of a whistleblower award of more than $10 million for original information that it said led to a major enforcement action over violations of the Commodity Exchange Act ("CEA"). This was just the third whistleblower award issued under the CFTC's whistleblower program and it represents a significant increase over the previous two awards (for approximately $240,000 and $290,000, respectively). The award is also the first following the disclosure in December 2015 by the CFTC's Inspector General of his review of the CFTC's whistleblower office over the limited number of awards issued when compared to a similar whistleblower program by the SEC, likely a sign of things to come.

CFTC's Whistleblower Program Overview

In 2011, the CFTC announced the opening of its Whistleblower Office, created under Section 748 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 ("Dodd-Frank Act") and Section 23 of the CEA. Much like the more heavily publicized and talked-about whistleblower program of the Securities and Exchange Commission, under the CFTC whistleblower program, the CFTC is required to pay awards, subject to certain limitations and conditions, to whistleblowers for original information that led to a successful enforcement action1 resulting in monetary sanctions greater than $1 million. We highlight some of the key components of the CFTC whistleblower program here:

  • Original information must be based on the whistleblower's independent knowledge or independent analysis. With certain exceptions, the information cannot be derived from the public sources such as corporate filings or from protected sources such as communications subject to the attorney-client privilege. The whistleblower also cannot have obtained the information through the entity's mechanism for identifying possible violations of law or as a result of the whistleblower's compliance or internal audit responsibilities.
  • The information must be provided voluntarily to the CFTC, meaning that the information must be provided before any request, inquiry, or demand for information from the CFTC, Congress, certain other agencies, entities, or self-regulatory organizations.
  • The whistleblower is not obligated to report potential violations internally in order to qualify for the CFTC whistleblowing awards. However, to incentivize internal reporting, the CFTC allows for the whistleblower to receive credit if they choose to report internally and they subsequently report to the CFTC within 120 days; and if the company conducts an investigation and reports the results to the CFTC, the whistleblower can seek credit for the information provided by the company.
  • The total amount of a whistleblower award is set between 10 and 30 percent of any monetary sanctions collected in either the CFTC action or a related action where their information played a key role. Per its rules, the CFTC has not disclosed the exact percentage of monetary sanctions in its publication of whistleblower awards.
  • The CFTC also will pay monetary awards to eligible whistleblowers whose information leads to successful enforcements of related actions brought by other governmental entities based on information submitted to the CFTC. Notably, unlike the SEC whistleblower program, the CFTC does not bar monetary awards to a whistleblower who has previously received an award from the SEC's whistleblower system, in part due to certain statutory differences in the definition of "related actions."
  • Employers may not retaliate against whistleblowers, who are afforded protections under the CFTC whistleblower program, under Section 23 of the CEA. Although the CFTC has determined that it does not have the statutory authority to initiate an enforcement action over retaliation claims, Section 23 of the CEA provides a federal cause of action for such violations and lists potential reliefs including reinstatement, back pay, compensation for related expenses, and reasonable attorney's fees.

Current Impact of the CFTC Whistleblower Program

The CFTC's whistleblower program has to date received far fewer tips and paid significantly fewer awards than the SEC's similar program. The most recent award marks only the third award granted by the CFTC since its program's inception over four years ago. In FY 2015, the CFTC received 232 whistleblower tips and complaints and 75 additional non-whistleblower tips and complaints, and did not pay any whistleblower awards.2 In contrast, the SEC received almost 4,000 whistleblower tips in FY 2015 and paid more than $37 million in whistleblower awards.3 

Part of the difference might be attributed to the broader mandate of the SEC. The Head of the CFTC's Whistleblower Office, Chris Ehrman, has previously noted the technical nature of the CFTC's cases and the agency's smaller scope may explain the slow progress of the CFTC whistleblower program.4  In addition, differences in the enforceability of its retaliation provisions and the number of relevant statutes decrease the potential footprint of the CFTC whistleblower program. But part of the difference is likely due to lack of publicity and awareness of potential whistleblowers, factors that significant awards like the one announced on April 4 may begin to change. As the CFTC continues to increase its enforcement focus and bring higher-profile cases in a range of subject areas, potential whistleblowers will likely take note.

Future Trajectory of the CFTC Whistleblower Program

As with its previous announcements of whistleblower awards, the CFTC did not provide information that would directly or indirectly identify the whistleblower and also declined to publicize the percentage of the monetary award when compared to the total sanctions. Still, even without these details, there are some lessons learned from the newest multi-million dollar award.

Going into FY 2016, the CFTC is clearly prioritizing awareness and efficacy of its whistleblower program. We have already seen a reflection of its increased efforts with the announcement of the Inspector General's investigation into the "low number" of whistleblowing awards in December 2015. In February 2016, the CFTC also launched a website for the whistleblower program at "whistleblower.gov" in order to promote the whistleblower program, providing a dedicated space for filing tips and complaints, notices of actions, and orders concerning awards. These actions, coupled with the publicity surrounding the $10 million whistleblower award and the CFTC's increased enforcement activity generally, will surely encourage more potential whistleblowers to step up and consider the CFTC as a potential destination for their tips. And because the CFTC has far fewer tips to evaluate every year than the SEC, it may be able to more easily prioritize prompt investigations.

Accordingly, while every instance of an actual whistleblower must be dealt with delicately and on a case-by-case basis depending on the nature of any allegations, even in the absence of a specific whistleblower allegation we encourage companies dealing in businesses regulated by the CFTC to takes steps to review their compliance programs to ensure that they provide adequate mechanisms for internal reporting and anti-retaliation measures so as to encourage internal reporting and investigation of any potential CEA violations before they reach the CFTC. Tips to the CFTC will surely increase in the coming months and years, and it is best for companies to be as prepared as possible.


1 See CFTC Final Rules, Whistleblower Incentives and Protection, available online at http://www.cftc.gov/idc/groups/public/@lrfederalregister/documents/file/2011-20423a.pdf.

2  CFTC 2015 Annual Report on the Whistleblower Program and Customer Education initiatives, available online at https://www.whistleblower.gov/files/Reports/wb_fy2015reporttocongress.pdf.

3  SEC 2015 Annual Report to Congress on the Dodd-Frank Whistleblower Program, available online at https://www.sec.gov/whistleblower/reportspubs/annual-reports/owb-annual-report-2015.pdf.

4  Russell-Kraft, Stephanie, CFTC Whisleblower Head Forecasts Big Things to Come, Law360, May 1, 2015, available online at http://www.law360.com/articles/649672/cftc-whistleblower-head-forecasts-big-things-to-come.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.