Siedle Receives Record $30M Payment from Commodity Futures Trading Commission
Friday, July 13, 2018
The award is the largest award made by the CFTC’s Whistleblower Program to date and is the fifth award made by the program.
This award is in addition to the record award Siedle is receiving from the U.S. Securities and Exchange Commission.
Siedle has been a constant critic of Governor Gina Raimondo’s strategy -- during her tenure as General Treasurer -- of diverting more than $1 billion from the retirement fund to high fee hedge funds. On Wednesday, the SEC tied Raimondo to a pay-to-play investigation with the private equity fund Oaktree.
“The Whistleblower Program has become an integral component in the agency’s enforcement arsenal,” said CFTC Chairman, J. Christopher Giancarlo. “We hope that an award of this magnitude will incentivize whistleblowers to come forward with valuable information and provide notice to market participants that individuals are reporting quality information about violations of the Commodity Exchange Act [CEA].”
“Many would-be whistleblowers aren't aware that investment fraud frequently involves commodities. They don't contact the Commodity Futures Trading Commission with their whistleblower complaints. Patience is required because it takes time for the government to prosecute wrongdoing and make awards. The public benefits when whistleblowers are rewarded. Whistleblowers leverage regulators resources,” Siedle, President of the firm Benchmark Financial Services, told GoLocal on Thursday morning.
James McDonald, Director of the Division of Enforcement said, “Whistleblower submissions have become a significant part of our enforcement program, allowing us to pursue violations we might otherwise have been unable to detect. That’s one reason why we’ve worked hard to expand our Whistleblower Program, including by increasing the protections afforded to whistleblowers that come forward. I expect the Whistleblower Program to contribute even more substantially to our enforcement efforts going forward.”
About the Program
The CFTC’s Whistleblower Program was created by section 748 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act). The CFTC pays monetary awards to eligible whistleblowers who voluntarily provide the CFTC with original information on violations of the CEA that leads the CFTC to bring a successful enforcement action resulting in monetary sanctions exceeding $1,000,000. By law, the CFTC protects the confidentiality of whistleblowers and does not disclose information that might directly or indirectly reveal a whistleblower’s identity. Under the Dodd-Frank Act, employers may not retaliate against whistleblowers for reporting possible violations of the CEA to the CFTC.
Whistleblowers are eligible to receive between 10 percent and 30 percent of the monetary sanctions collected. All whistleblower awards are paid from the CFTC Customer Protection Fund established by Congress and financed entirely through monetary sanctions paid to the CFTC by violators of the CEA. No money is taken or withheld from harmed investors to fund the program.
Previously, the highest award amount paid to a CFTC whistleblower was in March 2016 of more than $10 million (see CFTC Press Release 7351-16, CFTC Announces Whistleblower Award of More Than $10 Million).
“The award today is a demonstration of the program’s commitment to reward those who provide quality information to the CFTC,” said Christopher Ehrman, Director of the CFTC’s Whistleblower Office. “The number of leads the office receives continues to grow each year by the hundreds. We hope that this award will continue to facilitate the upward momentum and success of the CFTC’s Whistleblower Program by attracting those with knowledge of wrongdoing to come forward.”
This story was first published July 12, 2018 at 11:32 AM
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