Alert August 30, 2011

CFTC Issues Final Whistleblower Rules

The CFTC published final rules to implement its whistleblower program.  As it did for the SEC (see the May 31, 2011 Financial Services Alert for a discussion of the SEC’s whistleblower program), the Dodd-Frank Act established a whistleblower program that requires the CFTC to pay an award, subject to certain limitations and conditions, to an eligible whistleblower who voluntarily provides the CFTC with original information about a violation of the Commodity Exchange Act (the “CEA”) that leads to the successful enforcement of a covered judicial or administrative action, or a related action.  The Dodd‑Frank Act also prohibits retaliation by employers against individuals who provide the CFTC with information about possible CEA violations.  The final rules (a) define certain terms critical to the operation of the CFTC’s whistleblower program, including what persons are eligible to make claims, (b) adopt the forms and procedures for filing a whistleblower claim, (c) detail the standards that the CFTC will use to decide whether to make an award, and in what amount, (d) establish a process for appealing award determinations and (e) provide guidance on the Dodd-Frank Act’s anti-retaliation provisions.  To a large extent, the CFTC’s whistleblower rules resemble the SEC’s although there are differences in a number of areas.  The CFTC’s final rules become effective October 24, 2011.