December 10, 2020

Grassley, Hassan, Ernst, Baldwin Introduce Bill to Preserve Reward Fund for CFTC Whistleblowers

WASHINGTON – A bipartisan group of U.S. senators introduced legislation to expand a whistleblower reward fund in danger of drying up due to the increasing success of a program that helps identify and address wrongdoing. The CFTC Fund Management Act, led by Sens. Chuck Grassley (R-Iowa), Maggie Hassan (D-N.H.), Joni Ernst (R-Iowa) and Tammy Baldwin (D-Wis.), raises the ceiling of a fund used to reward whistleblowers, and secures the long-term success of the program without spending a single taxpayer dollar.

 

“Since the CFTC whistleblower program began in 2010, it’s been instrumental in identifying wrongdoing and protecting investors, all without costing the taxpayer a dime. The program is at risk of becoming a victim of its own success, as reward pay-outs threaten to exceed the caps on the fund used to encourage whistleblower disclosures. Our bill raises those caps and ensures that this program can continue to protect investors and improve accountability in a self-sufficient manner,” Grassley said.

 

“Whistleblowers play an essential role in calling out fraud and abuse, and we must ensure that the incentives to report wrongdoing and protect taxpayers remain in place. Our bipartisan legislation would raise the cap on the reward fund for whistleblowers, which is in danger of becoming depleted, and allow this successful program to continue operating. I urge my colleagues on both sides of the aisle to move swiftly to pass this bipartisan legislation before the fund dries up,” Hassan said.

 

The Customer Protection Fund was established in 2010 to reward whistleblowers for calling attention to wrongdoing that results in CFTC fines. It is funded from CFTC monetary collections resulting from whistleblower disclosures and is capped at $100 million. Operating expenses and educational initiatives are also paid out of the fund rather than taxpayer-funded appropriations. Any fines collected after the account reaches its cap are remitted to the Treasury general fund.

 

To date, the whistleblower office has collected more than $991 million in monetary sanctions. The increasing size and quantity of fines stemming from whistleblower disclosures have led to larger reward disbursements, which risks depleting the fund before it can be replenished with future fines. The CFTC Fund Management Act raises the fund cap to $250 million and establishes an account within the fund to house its operating and programming budget.

 

The bill is supported by Taxpayers Against Fraud and the National Whistleblower Center.