On June 23, the U.S. Commodity Futures Trading Commission (CFTC) posted two Notices of Covered Action regarding the recent settlement of enforcement matters. Deutsche Bank is to pay over $10 million. The Notices of Covered Action signal that individuals may now submit whistleblower award claims for the related matters. Individuals who voluntarily gave the Commission original information that led to the successful enforcement action are eligible for the award. CFTC whistleblowers can earn awards that may range from 10-30% of the over $10 million settlement.
The Notices of Covered Action refer to two separate settlements of enforcement matters, both involving Deutsche Bank. The first notice refers to a case in which Deutsche Bank AG settled federal court charges regarding alleged violations of swap data reporting requirements as well as other regulatory violations. The charges stem from an unprecedented swap reporting platform outage at Deutsche Bank that began on April 16, 2016. The settlement imposes a $9 million civil monetary penalty on Deutsche Bank. In the second matter, the CFTC filed and settled charges against Deustche Bank Securities Inc. (DBSI) that two DBSI traders engaged in spoofing. The charges allege that DBSI placed bids or offers on the Chicago Mercantile Exchange through two Tokyo-based traders with the intent to cancel those bids or offers. This kind of trade is an illegal practice known as spoofing. The settlement imposed a $1,250,000 civil monetary penalty on DBSI.
The passage of the Dodd-Frank Act in 2010 created the CFTC Whistleblower Program. Through this program, the CFTC pays monetary awards to individuals who provide original information regarding violations of the Commodity Exchange Act. If the information results in a successful enforcement action, the whistleblower can file an award claim. The program also provides anti-retaliation protections for whistleblowers.