U.S. Regulators Investigate Banks Over Whistleblower Rights

The Commodity Futures Trading Commission (CFTC) has initiated inquiries with major banks, including JPMorgan Chase, Bank of America, and Citigroup, to assess whether these banks have been impeding potential whistleblowers from speaking out, as reported by Bloomberg News on Wednesday.

According to sources familiar with the matter, the CFTC is scrutinizing non-disclosure agreements within the banks’ swaps and clearing businesses, along with examining employment and customer agreements in these areas.

Requests for comments from the CFTC, JPMorgan, and Citigroup to Reuters went unanswered, whereas Bank of America declined to provide a comment.

This action by the CFTC aligns with the increased oversight by the U.S. Securities and Exchange Commission (SEC) in this domain, which has imposed fines on companies failing to comply with whistleblower protection regulations.

Earlier in January, JPMorgan consented to pay an $18 million civil penalty to settle charges related to violations of whistleblower protection rules, as disclosed by the U.S. SEC.

Damian Williams, a prominent enforcer of financial misconduct on Wall Street, has encouraged whistleblowers to step forward and report illicit activities under a new initiative aimed at uncovering illegal behavior.

The regulatory scrutiny underscores a broader effort to protect whistleblower rights and ensure transparency within financial institutions.