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  • Writer's pictureJamal Saafir

Whistleblowers Paid $16 Million By CFTC For Crypto Related Tips

Updated: Dec 1, 2023

According to a report from Cointelegraph, the United States commodities regulator has paid $16 million this year to whistleblowers who divulged knowledge of questionable conduct leading to successful enforcement actions, with most of the tips revolving around cryptocurrency.

In an October 31st statement, Commodity Futures Trading Commission (CFTC) Commissioner Christy Goldsmith Romero stated that most of the incoming tips this year were related to crypto, which she claimed was “an area that continues to have pervasive fraud and other illegality.”

Two whistleblowers earned $15 million alone for knowledge shared with the CFTC that resulted in successful enforcement cases in September; nevertheless, the regulator didn’t go further into the nature of those cases in its statement at the time.

Romero said whistleblowers are essential to lessening the severity of commodities fraud and that the CFTC wouldn’t be able to “fully protect” customers and markets in their absence:

“Whistleblowers help identify fraud and other illegality, interpret key evidence, and save considerable Commission resources and time. The faster we can stop fraud, the more we can protect customers from harm.”

Commissioner Christy Goldsmith Romero

Romero recognized the work put forth by the CFTC’s Office of Customer Education and Outreach, which educates people on how to spot, avoid and report cryptocurrency fraud.

“With the rise of crypto, more retail customers have come under the CFTC’s jurisdiction,” Romero said.

The CFTC has disbursed almost $350 million since the launch of the program in 2014.

It’s been the catalyst for over $3 billion in enforcement sanctions ordered in cases made possible by way of whistleblower's tips.

The CFTC scored a record $3.4-billion penalty payment in a Bitcoin-related fraud case in April and won its case against Digitex CEO Adam Todd in July, who was ordered to pay $16 million in penalties.

In April, Romero repeated that managing the risks associated with cryptocurrency would be essential in supporting market integrity, national security, and financial stability.

She’s promoted integrating stronger identity verification protocols, saying it would lessen illicit finance in the crypto market.

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