In a press release, the Commodity Futures Trading Commission (CFTC) announced that they awarded over $15 million to crypto whistleblowers, which led to the firm bringing two separate successful enforcement cases. The CFTC commissioner, Christy Goldsmith Romero, stated that the whistleblowers provided significant information and assistance that played a crucial role in the enforcement cases.
This recent award brings the total amount awarded by the CFTC to whistleblowers to approximately $350 million. These awards have been instrumental in supporting investigations into fraud and other illegal activities in the crypto industry. The enforcement sanctions ordered in cases associated with these awards amount to more than $3 billion.
Whistleblowers are vital in helping the CFTC protect customers and markets. They provide key evidence and help interpret complex information, saving the Commission significant resources and time. Without their cooperation and support, the CFTC would not be able to fully carry out its mission.
The CFTC not only provides protections for whistleblowers but also offers incentives to encourage their cooperation. In 2023 alone, the Commission has received 1,530 tips related to fraudulent crypto activities, making it the highest number of tips for the year.
The first recipient of one whistleblower award interpreted key evidence and helped the Division of Enforcement identify new productive lines of inquires. This whistleblower pointed staff to the misconduct at issue in the resulting enforcement action plant that helped conserve CFTC time and resources. "These awards illustrate the success of our whistleblower program," said Ian McGinley, Director of the Division of Enforcement. "The program incentivizes whistleblowers like these two to come forward with accurate information, including evidence of ongoing misconduct, to help protect market participants and hold wrongdoers accountable." "These whistleblowers provided sustained cooperation and support, which helped catch more misconduct and conserve CFTC resources," said Whistleblower Office Acting Director Christina McGlosson. "Today's awards show how whistleblowers can act as force multipliers for the CFTC's enforcement efforts."
The CFTC's Whistleblower Program was established in 2010 under the Dodd-Frank Wall Street Reform and Consumer Protection Act. Since then, more than $3 billion in monetary sanctions have been awarded. The program ensures confidentiality for whistleblowers, with the CFTC protecting their identities unless under limited circumstances. Whistleblowers are eligible to receive between 10 and 30 percent of the monetary sanctions collected, which are paid from the CFTC's Customer Protection Fund.
The recent awards highlight the significant impact that whistleblowers have on the CFTC's enforcement efforts. They act as force multipliers, helping the Commission catch more misconduct and conserve valuable resources. The CFTC remains committed to supporting and incentivizing whistleblowers as they continue to play a crucial role in maintaining the integrity of the crypto industry.
