Hagens Berman Applauds Creation of New CFTC Whistleblower Program
SEATTLE – Hagens Berman’s managing partner Steve Berman today applauded the Commodity Futures Trading Commission’s (CFTC) adoption of final rules for its new program encouraging whistleblowers to move forward in cases with the CFTC.
The CFTC adopted the rules, based on Section 23 of the Commodity Exchange Act, on a 4-1 vote on August 4, 2011. The rules allow the CFTC to compensate individuals who give it credible information leading to a successful enforcement. To qualify, the whistleblower must provide information that leads to enforcement action with penalties totaling at least $1 million.
“After the derivatives market played such an important role in the financial meltdown of 2008, it was clear that some ground rules needed to be established,” said Berman. “Now that some of those rules are in place, these incentives will encourage whistleblowers to shine the light of public scrutiny on violators.”
Hagens Berman recently expanded its existing whistleblower practice to include the CFTC’s new program. The firm has extensive experience in a nexus of practice areas that match the CFTC’s focus, including commodities price-fixing, securities class actions and traditional False Claim Act whistleblower cases.
According to Berman, while the new CFTC rules will increase much-needed scrutiny, it will also likely cause an influx in the number of claims brought by whistleblowers.
“The CFTC has limited financial resources, especially with a number of new responsibilities under Dodd-Frank,” said Berman. “They will only take the most well-developed and actionable claims, and attorneys who successfully package those claims will have to have experience across a diverse set of areas, not just traditional whistleblower law.”
Historically, most whistleblower cases involve allegations of fraud involving government funding, while CFTC whistleblower claims involve specific violations of CFTC regulations and the Commodities Exchange Act.
Learn more about Hagens Berman’s CFTC Whistleblower practice.
Seattle-based Hagens Berman Sobol Shapiro LLP is one of the top class-action law firms in the nation, with offices in Boston, Chicago, Colorado Springs, Los Angeles, Minneapolis, New York, Phoenix, San Francisco and Washington, D.C. Founded in 1993, we represent plaintiffs in class actions and multi-state, large-scale litigation that seek to protect the rights of investors, consumers, workers and whistleblowers. More information about the firm is available at www.hbsslaw.com.
