CFTC Whistleblower Office Posts Notice of Covered Action for Recordkeeping Case

Photo of the exterior of the CFTC building in Washington, D.C.

On March 22, the Commodity Futures Trading Commission (CFTC) Whistleblower Office posted a Notice of Covered Action (NCA) for a $7 million enforcement action taken against the U.S. Bank, N.A., a swap dealer, and against Oppenheimer & Co., Inc., an introducing broker.

The NCA signals that the CFTC is now accepting whistleblower award claims for the case. Through the CFTC Whistleblower Program, qualified whistleblowers are entitled to monetary awards of 10-30% of the sanctions collected by the CFTC in the enforcement action connected to their whistleblowing.

According to the CFTC, from at least 2019, U.S. Bank, N.A., and Oppenheimer & Co., Inc. failed “to stop employees, including those at senior levels, from communicating using unapproved communication methods, including messages sent via personal text. The firms were required to keep certain of these written communications because they related to the firm’s CFTC-registered businesses. These written communications generally were not maintained and preserved by either firm, and neither firm generally would have been able to provide them promptly to the CFTC if and when requested.” Both orders further find the firm-wide use of unapproved communication methods violated each firm’s internal policies and procedures.

U.S. Bank, N.A., and Oppenheimer & Co., Inc. admit the facts described in the orders and are ordered to cease further violations of recordkeeping and supervision requirements and to comply with remedial proceedings.

Under the orders, U.S. Bank, N.A., is required to pay a $6 million civil monetary penalty, and Oppenheimer & Co., Inc. to pay a $1 million civil monetary penalty.

The CFTC’s NCA gives individuals 90 days to file a WB-APP to apply for a whistleblower award for the case. CFTC whistleblowers who voluntarily provide the agency with original information that contributes to the success of an enforcement action are entitled to a whistleblower award

Since the CFTC Whistleblower Program was established in 2010, whistleblower tips have allowed the CFTC to recover over $3 billion from fraudsters. The program has, in turn, paid out over $365 million in whistleblower awards.

In the 2023 Fiscal Year, the program received a record 1,530 whistleblower tips. The CFTC Whistleblower Program is currently in danger of being a victim of its own success, as a funding crisis threatens to undermine the program. A bipartisan bill introduced in July provides a long-term fix to the funding issue undermining the CFTC Whistleblower Program. The CFTC Whistleblower Fund Improvement Act is widely supported by whistleblower advocates.

National Whistleblower Center (NWC) is calling for the immediate passage of the CFTC Whistleblower Fund Improvement Act. NWC has set up an Action Alert calling on whistleblower supports to join them in urging Congress to pass the bill.

Join NWC in Taking Action:

Save the CFTC Whistleblower Program

Further Reading:

Notice of Covered Action No. 2024-006 – U.S. Bank N.A.

Leading Whistleblower Attorney: Congress Must Pass CFTC Whistleblower Funding Law

More CFTC Whistleblower News

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