February 26, 2021

Grassley, Hassan, Ernst, Baldwin Introduce Bill to Save CFTC Whistleblower Program from Potential Financial Shortfall

WASHINGTON – Sen. Chuck Grassley (R-Iowa) along with his colleagues Sens. Maggie Hassan (D-N.H.), Joni Ernst (R-Iowa) and Tammy Baldwin (D-Wis.) introduced the CFTC Fund Management Act to expand a whistleblower reward fund in danger of drying up due to the increasing success of the program. This bipartisan bill allows the commission to set aside more money from fines collected to pay whistleblower awards and secures the long-term success of the program without spending a single taxpayer dollar.

 

“The CFTC whistleblower program has become far more successful than Congress imagined when we set it up back in 2010. The risk of a cash shortage is so great, the commission recently told my office it’s temporarily paused review of some cases that could wipe out the Customer Protection Fund used to pay whistleblowers. I’ve been raising concerns about this issue for months and introduced legislation last year to address this problem, but Congress dragged its feet. Now whistleblowers are being asked to pay the price by waiting until the government can afford to review their claims. We can’t allow this program to become a victim of its own success. Congress has to pass this bill now to ensure that the CFTC whistleblower program remains solvent and can continue to grow,” Grassley said.

 

“Rooting out waste, fraud, and abuse is essential to protecting taxpayer dollars, and I am glad to partner with Senator Grassley to help ensure that the incentives for whistleblowers to call out this type of wrongdoing remain in place,” Hassan said. “By raising the cap on the whistleblower reward fund we will help prevent this successful program from becoming depleted. This is an important bipartisan bill and I urge my colleagues on both sides of the aisle to join us in supporting its swift passage.”  

 

The Commodities Futures Trading Commission (CFTC) relies on whistleblower disclosures to identify cases of fraud and other illegal activities and collect fines on behalf of the American people. The CFTC operates a Customer Protection Fund, established by Congress in 2010, to hold funds that are used to reward whistleblowers for their disclosures. That fund is also used to pay for operating expenses and educational initiatives associated with the whistleblower office. Under current law, the Customer Protection Fund is capped at $100 million, and any fines collected after the account reaches the cap are remitted to the Treasury’s general fund. In recent years, the increasing size and quantity of fines stemming from successful whistleblower disclosures have led to larger reward disbursements, which risk depleting the fund before it can be replenished.

 

The CFTC Fund Management Act raises the fund cap to $150 million and temporarily establishes a separate account to house funds used to pay operating and programming expenses. The creation of a separate account guarantees that the office will be able to continue operations should the overall amount held in the Customer Protection Fund drop to a critical level.

 

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