On the first day of the ABA White Collar Crime Conference, Aitan Goelman moderated a panel with Avi Perry of the Fraud Section of the Criminal Division of the Department of Justice, Manal Sultan of the CFTC and private practitioners. Christian Kemnitz and Anne Termine.

The Fraud Section recently formed a unit to focus on fraud and identity theft in commodities markets, which Perry heads. Perry explained that the unit does not focus on “ticky-tack” cases, but rather targets cases with a real impact on victims or on the integrity of the market. Perry discussed lessons learned from previous impersonation trials, including United States v. Flotron, which ended in an acquittal. As an example of such lessons, Perry noted the need to obtain more corroboration of testimony from immune witnesses as well as to take the time necessary to investigate complex cases.

Sultan discussed the current CFTC enforcement efforts. Despite active law enforcement, identity theft has not stopped, Sultan said, but identity theft has sometimes taken different forms as thieves are constantly trying to outsmart the market. The CFTC recently announced a record-breaking whistleblower award of $ 200 million and expects more awards to be made. She pointed out that the CFTC welcomes all tips, complaints and referrals, and is happy to pay rewards for the right prospects. The CFTC also published Guidance for staff on self-report recognition, cooperation, and remediation, which provides greater transparency on circumstances under which the CFTC may reduce penalties.

Finally, the panel discussed cryptocurrencies. Over the past few years, the CFTC has made its position clear that cryptocurrencies are commodities. But, more recently, SEC Chairman Gary Gensler jumped into the fray, declaring that cryptocurrencies can also be securities. The panel failed to come to a consensus on which agency might pose a greater threat to participants in the crypto market, but quickly noted that, when it comes to the application of crypto, we can all be sure the IRS would have its share. Perry added that the application of the cryptocurrency is also a high priority for the DOJ, noting that Deputy Attorney General Lisa Monaco recently announcement a national DOJ cryptocurrency enforcement team.

The issues around identity theft, whistleblowers and cryptocurrency are constantly evolving, and we’ll be here to bring you the latest news. If you have any questions, please do not hesitate to contact the author or your trusted Arnold & Porter advisor.

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