CFTC Proposes New Rule to Enhance Whistleblower Awards

The Commodity Futures Trading Commission (CFTC) has proposed a new rule that would change the default payout structure for whistleblower awards related to smaller enforcement cases. Under this proposed rule, eligible whistleblowers reporting violations with a total award pool of $5 million or less would benefit from a rebuttable presumption that they will receive the maximum statutory award of 30% of the monetary sanctions collected. This change is significant as it applies to approximately 82% of all historical whistleblower awards, indicating that most future payouts will start from the assumption of the highest possible compensation.

Previously, whistleblower awards under the Commodity Exchange Act ranged from 10% to 30% of monetary sanctions exceeding $1 million, requiring a detailed analysis for each case. The new rule, which falls under 17 CFR Part 165, aims to streamline this process by mirroring a similar presumption established by the U.S. Securities and Exchange Commission (SEC) for its whistleblower program. CFTC Chairman Michael S. Selig emphasized that these reforms not only enhance efficiency but also demonstrate institutional support for whistleblowers.

The CFTC's whistleblower program, initiated under the Dodd-Frank Act in 2010, has distributed over $430 million in awards since its inception, correlating with more than $3.7 billion in monetary sanctions. On June 1, 2026, the CFTC awarded over $8 million to five whistleblowers across various enforcement actions. The proposed rule was published on June 11, 2026, and the public comment period concluded on July 15, 2026. As of September 11, 2026, a final rule adoption has yet to be announced.

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Source: KLEA News