This week, the CFTC published a Notice of Proposed Rulemaking (NPRM) amending its whistleblower award determination rules (click here). The proposal targets one of the programme's longest-standing criticisms: the length of time it takes to process and pay out valid claims.
The CFTC's Whistleblower Programme was established under Section 748 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. It provides monetary incentives to individuals who come forward to report possible violations of the Commodity Exchange Act (CEA), alongside anti-retaliation protections for whistleblowers.
Since issuing its first award in 2014 (click here), the CFTC has awarded more than USD 430 million to whistleblowers. Under the existing rules, eligible whistleblowers can receive between 10 and 30 percent of the monetary sanctions collected in relation to the enforcement action they helped the CFTC successfully resolve. Such cases must result in monetary sanctions of over USD 1 million, or a successful enforcement action brought by entities such as the US Department of Justice (DOJ).
The CFTC has consistently announced whistleblower awards over the years, often amounting to substantial sums. As recently as 1 June 2026, it awarded USD 8 million to five whistleblowers (click here). By their nature, the underlying cases are always heavily redacted to protect the identities of the whistleblowers. Claims are administered by the Whistleblower Office (WBO), which reviews the circumstances surrounding each claim and awards individually.
Whistleblowers are an important enforcement stakeholder group for the CFTC, with circa 42 percent of its enforcement actions in 2024 involving whistleblowers.
Despite the programme's success, the current CFTC leadership believes that an important area for improvement exists regarding the time taken to process and award valid claims. Since the programme's inception, the average time taken from the deadline for prospective whistleblowers to submit an award claim to the date of the CFTC's Final Order granting an award is over two-and-one-half years. The CFTC believes that this lag dampens the incentive for potential whistleblowers, and this week's announcement aims to address this as well as improve transparency around the process.
According to the Proposed Rule (which can be downloaded here), the processing delays are caused by the CFTC applying the same detailed award-percentage analysis to both small and large whistleblower claims, regardless of the size of the potential payout. This can lead to lengthy internal discussions over the precise award percentage even where the difference in payment is relatively small, diverting resources from more complex cases. Delays are further exacerbated when claimants challenge proposed award percentages, requiring additional review and CFTC resources. A more detailed explanation of the CFTC's rationale for the proposed change can be found on pages 12 to 18 of the Proposed Rule.
The CFTC's proposed changes would add a new rule 165.9(d) and redesignate the existing rule § 165.9(d) as § 165.9(e). The changes would introduce a presumption that meritorious whistleblower awards involving monetary sanctions of USD 5 million or less will be set at the statutory maximum award of 30 percent.
This presumption carries conditions, however, and can be overridden under three circumstances:
In cases with multiple claimants, the CFTC would maintain the overall 30 percent cap while allocating larger shares to claimants who fully satisfy the relevant conditions. The changes are modelled on a similar approach taken by the US Securities and Exchange Commission (SEC), which has seen improved efficiency and shortened award times since implementation.
By making whistleblower rewards easier to understand and attain, the CFTC's proposal is designed to incentivise more whistleblowing, and firms should be prepared for this. Should the changes be implemented as proposed, the prospect of a quicker, more certain payoff is likely to encourage potential whistleblowers to come forward. While the effects are unlikely to be immediate, the 42 percent enforcement-involvement figure for 2024 underscores how significant whistleblowers already are to the CFTC's enforcement work, and that significance looks set to grow.
Firms should consider the elevated risk from whistleblowers in their internal risk registers and ensure that their internal whistleblower framework, including policies and processes, is in place, up to date, and fully functioning.