On October 14, a collection of whistleblower advocacy groups sent a letter to Senator Chuck Grassley (R-IA) commending him for recently questioning nominees to the Commodity Futures Trading Commission (CFTC) about their support for the agency’s whistleblower program. According to the groups, Grassley’s questions “are highly encouraging to us as organizations deeply committed to whistleblower protection.”
On October 4, Senator Grassley sent letters to three nominees for the CFTC urging them to support the agency’s whistleblower program. One letter was sent to Acting Chairman of the CFTC Rostin Behnam, who has been nominated to be the agency’s Chairman. The other letters were sent to Christy Goldsmith Romero, the Special Inspector General for the Troubled Asset Relief Program and Kristin Johnson, Asa Griggs Candler Professor of Law at Emory University School of Law, who are nominees to serve as CTFC Commissioners.
In the letters, Grassley highlights the success of the CFTC Whistleblower Program, noting that “[a]s of April 2021, the CFTC has granted whistleblower awards associated with enforcement actions that have resulted in monetary sanctions totaling more than $1 billion,” and that “[t]he whistleblower program continues to serve as a vital part of the CFTC’s broader enforcement efforts.”
However, Grassley also points out that “[b]ecause of its great success, the whistleblower fund is at risk of being depleted.” He explains that ‘the increasing size and quantity of fines arising from successful whistleblower disclosures have led to larger reward disbursements. Current law requires that the whistleblower fund be capped at $100 million, and any fines collected past the cap are remitted to the Treasury’s general fund. The disbursement of larger rewards from a capped fund poses an impending threat to the CFTC whistleblower program’s ability to function.”
The whistleblower groups note that Grassley helped lead efforts to pass the CFTC Fund Management Act earlier this year. The Act, which was supported by the advocacy groups, was signed into law in July and saved the program from financial disaster. Longer term solutions to the funding issue are still needed, however.
In his letters, Grassley asked the nominees a number of questions, including whether they “commit to provide the necessary resources to the CFTC whistleblower program”, whether they will work with Congress to strengthen to program, and whether they “support a long-term solution to restoring the whistleblower fund and maintaining the program.” In their letter, the whistleblower groups state they “join in calling for answers from CFTC nominees.”
The whistleblower groups note that Grassley asked similar questions to Securities and Exchange Commission (SEC) Chair Gary Gensler when he was a nominee. “Your questions then brought attention to the highly successful SEC whistleblower program and garnered meaningful commitments from the nominee about how the SEC whistleblower program would be fortified under his leadership,” the letter states.
“It is our hope that like Chair Gensler,” the letter continues, “the questions you posed to the CFTC nominees will garner meaningful whistleblower supporting answers that will result in tangible post confirmation efforts to improve the already successful whistleblower program.: