The Wall Street Journal reported today that the Commodity Futures Trading Commission's highly successful whistleblower program is on the verge of collapse. A fund used to pay whistleblowers and help operate the CFTC's Whistleblower Office is about to run out of money due to the high success of the program and problems related to the ability of the CFTC to replenish is special whistleblower fund.
Under the Dodd-Frank Act all rewards paid to whistleblowers must come from the fines and penalties collected by the United States.
In light of this crisis Stephen M. Kohn, a whistleblower attorney and the Chairman of the Board of Directors of the National Whistleblower Center, issued the following statement:
“One of the United States' top whistleblower reward programs is in danger of collapsing due to its high level of success. Immediate Congressional action is needed. Whistleblowers may be out in the cold for years if Congress does not fix this problem.”
“The Commodity Futures Trading Commission (CFTC) Whistleblower Office has seen unanticipated success since its inception, and now faces a massive crisis as whistleblowers are unable to be compensated for their reporting efforts.”
“A limit on the amount of money that can be deposited into the CFTC's Consumer Protection Fund, the lone source for rewarding whistleblowers, has created a backlog so extensive that millions of dollars' worth of awards are unable to be granted to eligible claimants. Additionally, the Fund is unable to offset the direct costs of running the CFTC's Whistleblower Office.”
“It is crucial for Congress to take action and pass bi-partisan emergency legislation proposed by Senator Charles Grassley, and co-sponsored by Tammy Baldwin (D-Wis), Joni Ernst (R-Iowa), Maggie Hassan (D-NH) and Susan Collins (R-Maine). This way, the size of the Fund used to pay whistleblowers can be increased and the highly successful CFTC Whistleblower Program can continue to operate.”
“For the past year, we have warned of this pending disaster for the CFTC program. It is intolerable that the U.S. government uses whistleblowers to obtain invaluable insider information, and then fails to ensure that they can be rewarded.”
“Continued Congressional inaction demonstrates a contempt for whistleblowers.”
Since issuing its first award in 2014, the CFTC Program has awarded over $220 million to whistleblowers. The CFTC has triggered billions in collected sanctions.
Kohn's article in The National Law Review fully explaining this issue is linked here.
Kohn continued: “This harms all whistleblowers in the CFTC program, not just the person's obtaining large rewards. It sends the wrong message.”
— WebWireID273785 —
