Over the past three months, the U.S. Commodity Futures Trading Commission (CFTC) has granted US$150 million in whistleblower awards — and it’s adopting a rule to speed up such payouts.
The U.S. derivatives regulator reported that between July and September, it has granted 10 awards for enforcement tips, totalling more than US$150 million.
With the latest payouts, the CFTC has now paid US$580 million to whistleblowers for tips that resulted in enforcement actions that have generated more than US$5.1 billion in monetary sanctions, the regulator said.
“The number and size of these awards demonstrate that the commission is committed to rewarding whistleblowers who play a critical role in the commission’s efforts to deter and prevent disruptions to our markets,” said Raagnee Beri, director of the CFTC’s Whistleblower Office, in a release.
Last week, the CFTC also approved a change to its whistleblower rules, which adopts the U.S. Securities and Exchange Commission’s policy of defaulting to presuming that awards of less than US$5 million will represent 30% of the sanctions imposed.
Currently, the regulators’ whistleblower policies allow for rewards that represent between 10% and 30% of sanctions, depending on a variety of factors. Now, regulators are hoping to speed up the adjudication of claims by stipulating that smaller claims will be assumed to result in 30% awards.
“The commission expects the rule changes … will shorten the time needed to resolve meritorious, smaller-dollar whistleblower claims by limiting the scope of analysis and intra-agency review of the appropriate award percentage,” the CFTC said in its final rule.
In turn, this will allow the regulators to focus on and speed up decisions for larger awards.
The final rule will be effective 30 days after publication in the Federal Register.