The Commodity Futures Trading Commission (CFTC) approved its fifth, and to date largest, whistleblower award on Thursday when it awarded $30 million to a former JPMorgan employee. This is the last step in a process that began publicly in 2015, when the bank settled with the CFTC for $367 million for suggesting certain investments to asset-management clients without disclosing conflicts of interest.
The Dodd-Frank Act created separate whistleblower programs for the Securities Exchange Commission (SEC) and the CFTC. The SEC whistleblower program deals with securities violations ranging from the failure to disclose material information to shareholders to Ponzi schemes and foreign bribery. The CFTC program is similarly designed to protect investors, but focuses on fraud related to commodities, including stock futures. The programs operate under similar guidelines, and the CFTC amended its program in 2017 to synchronize with the better-known SEC program.
This award, which rivals some of the largest SEC whistleblower awards, will undoubtedly raise the profile of the CFTC program. According to the whistleblower’s attorney, this increased awareness may also prompt more whistleblowers to come forward. The attorney added, “This award demonstrates that the CFTC is willing to act quickly on those complaints if contacted.”
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