During May, 2017, the Commodity Futures Trading Commission (CFTC) changed its whistleblower rules in several ways. The most notable alteration was additional protections for whistleblowers against retaliation. These modifications to the CFTC’s Whistleblower Rules also improved the process associated with reviewing claims of retaliation. Changes were first proposed by the CFTC in 2016.
The CFTC regulates commodities and futures contracts and violations of its rules are covered by the Dodd-Frank Act. If you are considering bringing a whistleblower case related to CFTC regulations or if you are in the process of bringing such a case, and you believe you have experienced retaliation, these amendments should be of immediate interest to you.
What Do the Amended Rules Cover?
Either the CFTC or the whistleblower is now able to bring a case against an employer who retaliates against a whistleblower. The changed rules have come about because of a reinterpretation of the authority the CFTC holds under the Commodity Exchange Act (CEA) when it comes to anti-retaliatory measures.
The amendments also bar an employer from attempting to prevent a prospective whistleblower from direct communication with CFTC staff about a possible CEA violation. This action could come about by using a previously-signed agreement against the whistleblowing employee, with the agreement written for confidentiality provisions, for pre-dispute arbitration provisions, or for similar employment areas. According to federal law, such agreements are not allowed to be used to impede the whistleblowing process.
What Else is Covered by the New Amendments?
It is anticipated that the new changes will bring the CFTC’s Whistleblower Rules, which are covered by Part 165 of CFTC Regulations, in line with those outlined in the SEC’s whistleblower program. These changes would create consistency across the agencies. Additional transparency and efficiency concerns when it comes to whistleblower award decisions are also expected to be a positive outcome of the amendments.
Additionally, the improved rules will launch a claims review process using a Claims Review Staff to make a Preliminary Determination regarding the granting or denial of an award claim. The Preliminary Determination can be reviewed by the whistleblower upon request, who can then challenge the Preliminary Determination, if desired, before the Final Determination is delivered by the CFTC.
The Director of the CFTC’s Division of Enforcement, James McDonald, remarked, “The Whistleblower Program is an integral part of the Division’s efforts to identify and prosecute unlawful conduct. The [CFTC’s] approval of these rules today will further strengthen and enhance our efforts to protect customers and promote market integrity.”
A Possibly-Related Case?
Digital Realty Trust Inc., on April 25, 2017, requested that the United States Supreme Court decide on a matter concerning an employee filing an internal complaint, as opposed to a complaint that is filed with the SEC. Specifically, the matter under consideration is whether an internally-complaining employee is covered by the protections afforded to whistleblowers under the Dodd-Frank Act.
On March 8, 2017, the Ninth Circuit decided that the anti-retaliatory provisions of Dodd-Frank also protect an employee who files internal complaints (Somers v. Digital Realty Trust, 15-17352). Digital Realty Trust informed the Supreme Court that, in their opinion, reviewing this decision would allow the Court to resolve a split between the Ninth and Second Circuits and the Fifth Circuit. The Fifth has held that a whistleblower is required to report retaliation concerns to the SEC, not just internally, to receive Dodd-Frank protections.
It will be instructive to discover if the Supreme Court will take the case and, if so, whether the Ninth Circuit’s ruling will be allowed to stand.
Blowing the Whistle? We Can Help You with Your Next Step.
If you think you have the facts needed to bring a whistleblower case, the experienced whistleblower attorneys at the Louthian Law Firm can review your case and help you file the appropriate disclosure statement. Under some circumstances, the government will intervene, or join in your lawsuit.
Your chances of succeeding are greater if your whistleblower claim is substantive, clear, and to the point. Because of this, meeting with a qualified whistleblower attorney can increase your chances of winning. The Louthian Law Firm can help you form your claim so that the government will be more inclined to intervene in your case; government intervention can sometimes increase the chances of recovering reward money. Even if the government decides not to intervene, it could still be a good idea to pursue your case without government involvement. Our strong support system can assist you through every step of the process.
For a free, confidential evaluation of your case, call the Louthian Law Firm today at 1-803-454-1200 or, if you prefer, you can fill out our online contact form.