Under the CFTC Whistleblower Program, whistleblowers are eligible for monetary awards when they voluntarily provide the CFTC with original information about violations of the Commodity Exchange Act (“CEA”) that lead to a successful enforcement action resulting in monetary sanctions exceeding $1,000,000.

CFTC-regulated swaps, including Foreign Exchange (“FX”) Forwards and FX Swaps, pose significant systemic risks. Indeed, “the continued pursuit of various opportunistic strategies in the credit derivatives markets, including but not limited to those that have been referred to as ‘manufactured credit events,’ may adversely affect the integrity, confidence and reputation of the credit derivatives markets, as well as markets more generally. These opportunistic strategies raise various issues under securities, derivatives, conduct and antifraud laws, as well as public policy concerns.” See Joint Statement on Opportunistic Strategies in the Credit Derivatives Market (June 24, 2019).

Examples of violations of swaps-related CFTC regulations that can qualify for a CFTC whistleblower award include:

• manipulating or attempting to manipulate the price of any swap, or of any commodity in interstate commerce, such as “hitting spreads down,” “hit[ting] the screen to avoid a los[s],” and “pushing [basis swaps] down,” examples of manipulation in a $45 million settled action with HSBC;
• trading on the basis of material non-public information (“MNPI”) in breach of a pre-existing duty or on...

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