Securities Regulation Daily Wrap Up, WHISTLEBLOWER NEWS—CFTC final rule amends whistleblower award rules to decrease delays, (Sep 14, 2026)

By Rebecca E. Hoffman, J.D.

The amendments to part 165 of CFTC regulations are expected to further encourage whistleblower action.

The CFTC announced a final rule September 11 that will amend rules implementing Section 23 of the Commodities Exchange Act, applying to awards for those who supply information for the CFTC leading to successful actions against violations of the CEA or its regulations.

The final rule is modeled on the SEC’s comparable whistleblower provision, which has had the effect of decreasing lag time between reporting and receiving an award. CFTC Chair Michael S. Selig believes the CFTC version “will help our Whistleblower Office to promptly and transparently process whistleblower claims, representing an important step in further harmonizing the CFTC and SEC.”

Current program. Original information about a violation of the CEA or its regulations, provided voluntarily, can be eligible for an award under the program. To qualify for an award, the information must lead to a successful CFTC enforcement action, with sanctions totaling over a million dollars, or to a successful action by particular entities, such as the Justice Department. Factors that affect the amount of an award include the degree to which the whistleblower assisted the Commission, and whether and to what extent the whistleblower was involved in the violation or delayed in providing the information.

Claims review staff issue a preliminary determination, which the whistleblower can challenge before it is finalized. “In promulgating rule 165.9, the Commission expressed its intent that whistleblower award amounts be determined based on an individualized review of the circumstances surrounding each award,” the rule stated.

The whistleblower program has been successful, the Commission said. But the amendments ideally will shorten the time it takes to process and pay out awards. The current time gap—averaging over 2.5 years—diminishes the value of the award and makes it less likely for a whistleblower to come forward, the CFTC explained. Analysis of the various factors for every award “consumed resources that otherwise could be devoted to resolving larger, more complex matters.” The amendments simplify the process for whistleblower claims of lesser amounts.

‘30 Percent Presumption.’ Instead of analyzing factors for every award regardless of size to assess the percentage for which a whistleblower would be eligible, the new rule introduces the “30 Percent Presumption,” whereby the whistleblower would be set to receive an amount that is 30 percent of monetary sanctions collected—the statutory maximum—if that amount would total $5 million or less. The presumption is conditional, and does not apply if: 1) the claimant is culpable or involved in the violation, 2) the claimant unreasonably delays their reporting, or 3) the assistance is limited, or the award would be inconsistent with the public interest.

Applying the presumption should “materially reduce” the time it takes to process these applications, thus getting awards to their recipients faster, increasing the incentive for whistleblowers to come forward. Furthermore, “proposed new rule 165.9(d) is tailored to improve Program efficiency, transparency, and predictability without sacrificing Program integrity or public interests.”

The Commission estimated that 82 percent of meritorious whistleblower claims would qualify for the streamlined process.

In June, the CFTC asked the public to comment on proposed amendments. The final rule noted that nine commenters responded. All but one of these were in favor of the changes, but the proponents had some recommendations. One such suggestion was for strict deadlines for the preliminary and final award determinations, but the CFTC “anticipates that the administrative costs of tracking and ensuring compliance with fixed deadlines, and the potential litigation exposure if deadlines were missed, could exceed the efficiency gains that the 30 Percent Presumption is designed to achieve.”

The rule will take effect 30 days after publication in the Federal Register.

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