CFTC Makes First Whistleblower Award Under Trump, But Reduces Award Because of Whistleblower Delay and Culpability

By the Constantine Cannon Whistleblower Team

Last Thursday (May 29), the Commodities Futures Trading Commission (CFTC) announced a whistleblower award of roughly $700,000.¹  According to the agency’s press release promoting the award, the whistleblower “prompted the CFTC to open the investigation,” and “provided substantial assistance and helped the Commission conserve resources during the investigation.”

Under the CFTC Whistleblower Program, individuals who report commodities violations to the agency may receive up to 30% of any resulting Government recovery.  Sticking to its strict commitment of maintaining the confidentiality of its whistleblowers, the CFTC did not identify the whistleblower or the associated enforcement action.

The CFTC Reduced the Award Because of Whistleblower Delay and Culpability

Notably, the award would have been even larger but for what the agency considered the whistleblower’s “unreasonable delay in reporting the violations” and the whistleblower’s apparent participation in the alleged misconduct.  These are two significant factors the CFTC will consider when determining the amount of any whistleblower award.

As explained in the Award Order,² the whistleblower waited roughly four years to report the violation to the agency.  The SEC found this to be an unreasonable delay under SEC Rule 165.9(c)(2)(i), which directs the agency to consider how long the whistleblower waited to report potential violations.

The SEC also reduced the award because of the whistleblower’s personal involvement in the violations at issue.  Under SEC Rule 165.9(c)(1), the agency must also consider the whistleblower’s participation in the wrongdoing in determining the award amount.  Here, the SEC found the whistleblower engaged in the illegal scheme — which the agency described as “egregious” — and fully understood the wrongfulness of the conduct.

First CFTC Whistleblower Award Under Trump 

The award is the first CFTC whistleblower award in almost seven months (a $4 million award on November 12), and the first since President Trump took office.  In announcing the award, the CFTC made a strong showing of whistleblower support, with recently departed CFTC Enforcement Director Brian Young proclaiming how “whistleblowers often provide the most valuable evidence about wrongdoing.”  He further recognized “the courage it takes to come forward” and “the critical role whistleblowers play in the CFTC’s enforcement efforts.”

Acting CFTC Whistleblower Chief Cynthia Lie echoed this sentiment, highlighting the agency’s commitment “to rewarding whistleblowers for their significant contributions in identifying fraud, manipulation, and abuse in commodity markets.”  This award and the CFTC’s promotion of it — despite the whistleblower’s inordinate delay and participation in the misconduct — provides a strong indication of the Trump Administration’s support for the CFTC Whistleblower Program.

The award also follows several recent whistleblower-related enforcement actions we have previously posted on that further signal the Trump Administration’s commitment to including whistleblowers as key components of the Government’s overarching enforcement scheme.  This includes DOJ’s new initiative to use False Claims Act whistleblowers to push its anti-DEI agenda, DOJ’s expansion of its Corporate Whistleblower Awards Pilot Program, and the SEC’s first whistleblower award under Trump.

Constantine Cannon whistleblower partner Gordon Schnell points to this recent whistleblower activity as a good indication of the Trump Administration’s support for whistleblowers.  “Whether or not you agree with President Trump’s enforcement priorities,” Schnell says, “it seems apparent he and his Administration understand the powerful role whistleblowers can play in helping the Government go after fraud and misconduct.”

Constantine Cannon Has Substantial Experience Representing CFTC Whistleblowers

The CFTC has made roughly $390 million in whistleblower awards since its first award in 2014.  These awards relate to enforcement actions that have resulted in more than $3.2 billion in monetary sanctions.  However, there has been a relative paucity of awards over the past year, with no awards even approaching the record $200 million award the CFTC made in October 2021 to the LIBOR benchmark manipulation whistleblower.

Nevertheless, as detailed in the agency’s most recent Annual Whistleblower Report, 2024 was a very active year for the whistleblower program, with the CFTC hitting several notable milestones.  These included issuing 12 whistleblower award orders, the most in any year, and receiving 1,744 whistleblower submissions, again the most in any year.

Constantine Cannon has substantial experience representing whistleblowers under the CFTC Program.  If you would like to learn more about the Program, what it means to be a whistleblower more generally, or our multiple whistleblower successes, please do not hesitate to contact us.  We will connect you with an experienced member of the Constantine Cannon whistleblower team for a free and confidential consultation.

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