As entreaties from government agencies go, these were emphatic.
“The Whistleblower Office of the Commodity Futures Trading Commission is issuing this alert to inform members of the public about how they may make themselves eligible for both financial awards and certain protections while helping stop fraud and manipulation relating to virtual currencies,” reads one online post dated May 2019.
The CFTC went on to explain that virtual currencies like Bitcoin are considered commodities under the Commodity Exchange Act, which triggers the CFTC’s enforcement of the act when a virtual currency is used in a derivatives contract, or if there is fraud or manipulation involving a virtual currency traded in interstate commerce.
Meanwhile, the Securities and Exchange Commission lists “initial coin offerings and cryptocurrencies” as one of the areas ready and willing to accept the help of whistleblowers to probe for possible violations of the federal securities laws.
The number of whistleblowers who responded to the calls for crypto-related tips has spiked in recent years, according to data compiled by attorneys at Mintz Levin in Boston.
In 2020, the SEC received a total of 6,911 tips, only 345 of which — or 5 percent — were related to cryptocurrency or initial coin offerings. In 2021, the SEC took in 12,210, and 762 (6.2 percent) dealt with cryptocurrency or initial coin offerings.
In 2022, the SEC received a similar number of tips (12,322), but 1,719, or 14 percent, related to...
This story is the second in an ongoing series on the Cost of Fraud, as Open the Books tallies the hidden fees on American tax returns. Click here to read the first story on fraudulent autism billi...