CFTC Rewards – Eligibility and Exclusions

CFTC Whistleblowers – Eligibility and Exclusions

Eligibility Provisions:

Pursuant to the Whistleblower rules and requirements from the CFTC, the Commission will pay an award to one or more whistleblowers who:

Provide a voluntary submission to the Commission…

The phrase ‘‘voluntary submission’’ or ‘‘voluntarily submitted’’ . . . , shall mean the provision of information made prior to any request from the Commission, Congress, any other federal or state authority, the Department of Justice, a registered entity, a registered futures association, or a self-regulatory organization to the whistleblower or anyone representing the whistleblower (such as an attorney) about a matter to which the information in the whistleblower’s submission is relevant. If the Commission or any of these other authorities makes a request, inquiry, or demand to the whistleblower or the whistleblower’s representative first, the whistleblower’s submission will not be considered voluntary, and the whistleblower will not be eligible for an award, even if the whistleblower’s response is not compelled by subpoena or other applicable law. For purposes of this paragraph, the whistleblower will be considered to have received a request, inquiry or demand if documents or information from the whistleblower is within the scope of a request, inquiry, or demand that the whistleblower’s employer receives, unless, after receiving the documents or information from the whistleblower, the whistleblower’s employer fails to provide the whistleblower’s documents or information to the requesting authority in a timely manner.
In addition, the whistleblower’s submission will not be considered voluntary if the whistleblower is under a pre-existing legal or contractual duty to report the violations that are the subject of the whistleblower’s original information to the Commission, Congress, any other federal or state authority, the Department of Justice, a registered entity, a registered futures association, or a self-regulatory organization, or a duty that arises out of a judicial or administrative order.

… That contains original information…

The phrase ‘‘original information’’ means information that—

Is derived from the independent knowledge or independent analysis of a whistleblower;

Is not already known to the Commission from any other source, unless the whistleblower is the original source of the information;

Is not exclusively derived from an allegation made in a judicial or administrative hearing, in a governmental report, hearing, audit, or investigation, or from the news media, unless the whistleblower is a source of the information; and

Is submitted to the Commission for the first time after July 21, 2010 (the date of enactment of the Wall Street Transparency and Accountability Act of 2010).

… That leads to the successful resolution of a covered Commission judicial or administrative action or successful enforcement of a related action…

The Commission will consider that the whistleblower provided original information that led to the successful enforcement of a judicial or administrative action, or related action, in the following circumstances:

The whistleblower gave the Commission original information that was sufficiently specific, credible, and timely to cause the Commission staff to commence an examination, open an investigation, reopen an investigation that the Commission had closed, or to inquire concerning different conduct as part of a current examination or investigation, and the Commission brought a successful judicial or administrative action based in whole or in part on conduct that was the subject of the whistleblower’s original information; or

The whistleblower gave the Commission original information about conduct that was already under examination or investigation by the Commission, the Congress, any other authority of the federal government, a state Attorney General or securities regulatory authority, any self-regulatory organization, futures association or the Public Company Accounting Oversight Board (except in cases where the whistleblower was an original source of this information . . . ), and the whistleblower’s submission significantly contributed to the success of the action.

The whistleblower reported original information through an entity’s internal whistleblower, legal, or compliance procedures for reporting allegations of possible violations of law before or at the same time the whistleblower reported them to the Commission; the entity later provided the whistleblower’s information to the Commission, or provided results of an audit or investigation initiated in whole or in part in response to information the whistleblower reported to the entity; and the information the entity provided to the Commission satisfies either paragraph (1) or (2) [above]. Under this paragraph (3), the whistleblower must also submit the same information to the Commission in accordance with the procedures set forth [by the commission] within 120 days of providing it to the entity.

… The CFTC must obtain monetary sanctions totaling more than $1 million in the action.

The phrase ‘‘covered judicial or administrative action’’ means any judicial or administrative action brought by the Commission under the Commodity Exchange Act whose successful resolution results in monetary sanctions exceeding $1,000,000.

Exclusions from Award:

No award shall be made:

To any whistleblower who is, or was at the time the whistleblower acquired the original information submitted to the Commission, a member, officer, or employee of: the Commission; the Board of Governors of the Federal Reserve System; the Office of the Comptroller of the Currency; the Board of Directors of the Federal Deposit Insurance Corporation; the Director of the Office of Thrift Supervision; the National Credit Union Administration Board; the Securities and Exchange Commission; the Department of Justice; a registered entity; a registered futures association; a self-regulatory organization; or a law enforcement organization;
To any whistleblower who is convicted of a criminal violation related to the judicial or administrative action for which the whistleblower otherwise could receive an award . . . ;
To any whistleblower who submits information to the Commission that is based on the facts underlying the covered judicial or administrative action submitted previously by another whistleblower;
To any whistleblower who acquired the information the whistleblower gave the Commission from any of the individuals described [above] . . . ;
To any whistleblower who, in the whistleblower’s submission, the whistleblower’s other dealings with the Commission, or the whistleblower’s dealings with another authority in connection with a related action, knowingly and willfully makes any false, fictitious, or fraudulent statement or representation, or uses any false writing or document, knowing that it contains any false, fictitious, or fraudulent statement or entry, or omitted any material fact, where, in the absence of such fact, other statements or representations made by the whistleblower would be misleading;

To any whistleblower who acquired the original information reported to the Commission as a result of the whistleblower’s role as a member, officer or employee of either a foreign regulatory authority or law enforcement organization;
To any whistleblower who is, or was at the time the whistleblower acquired the original information submitted to the Commission, a member, officer, or employee of a foreign regulatory authority or law enforcement organization; or

To any whistleblower who acquired the original information the whistleblower gave the Commission from any other person with the intent to evade any provision of [CFTC whistleblower] rules.

Click here for the full CFTC whistleblower rules