Corporate Counsel Daily, Whistleblowers challenge award denials in CFTC enforcement against ‘off-channel’ communications, (Oct 23, 2024)
Law Firms Mentioned:Washington Global Law Group PLLC
The CFTC enforcement actions relating to the whistleblower award denials have netted over $1.2 billion in civil penalties.
A group of anonymous whistleblowers are challenging the CFTC’s denial of whistleblower awards relating to enforcement actions over the widespread use of unapproved “off-channel” communications by employees at multiple financial institutions. Twenty petitions for review filed by John Doe plaintiffs, now consolidated in the D.C. Circuit, relate to a years-long sweep of significant recordkeeping and supervision failures involving failure to preserve thousands of business records as required (Doe v. CFTC, No. 24-1326 (D.C. Cir. filed Oct. 16, 2024)).
The CFTC announced in September that the agency has imposed $1.237 billion in civil monetary penalties against 27 financial institutions in the enforcement actions to date.
Petitions for review. While the petitions are sealed, counsel for plaintiffs confirmed that the award denials relate to CFTC denials of applications for whistleblower awards in enforcement actions relating to recordkeeping and supervision violations.
“Petitioner is seeking to overturn the CFTC whistleblower award denials on the agency’s enforcement actions against financial institutions for recordkeeping and supervision failures with respect to employees’ widespread use of texts, WhatsApp, and other unapproved methods to conduct business,” said Max Maccoby, Washington Global Law Group.
The petitions seek review of a final CFTC order entered September 17, 2024, pursuant to 7 U.S.C. § 26, 17 C.F.R. § 165.13, and Federal Rule of Appellate Procedure 15. The cited CFTC regulation, § 165.13, relates to appeals of whistleblower award determinations.
The court has issued a schedule for motion filing.
The CFTC did not respond to a request for comment.
This is case No. 24-1325 (consolidated with 24-1326, 24-1327, 24-1328, 24-1329, 24-1330, 24-1331, 24-1332, 24-1333, 24-1334, 24-1335, 24-1336, 24-1337, 24-1338, 24-1339, 24-1340, 24-1341, 24-1342, 24-1343, 24-1344).
Attorneys: Max Maccoby (Washington Global Law Group PLLC).
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