Womble Perspectives
Welcome to Womble Perspectives, where we explore a wide range of topics from the latest legal updates to industry trends to the business of law. Our team of lawyers, professionals and occasional outside guests will take you through the most pressing issues facing businesses today and provide practical and actionable advice to help you navigate the ever-changing legal landscape. With a focus on innovation, collaboration and client service, we are committed to delivering exceptional value to our clients and to the communities we serve.
Womble Perspectives
Whistleblower Claims and the Future of Corporate Accountability
Welcome back to Womble Perspectives. Today, we’re diving into a case that’s raising questions about corporate compliance, whistleblower protections, and the future of deferred prosecution agreements.
A recent whistleblower lawsuit filed in New York State Supreme Court could have major implications for Freepoint Commodities, a Connecticut-based energy trading firm. The suit alleges insider trading violations and retaliation, and it comes just two years after Freepoint entered into a three-year deferred prosecution agreement with the Department of Justice for violations of the Foreign Corrupt Practices Act.
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Welcome to Womble Perspectives, where we explore a wide range of topics, from the latest legal updates to industry trends to the business of law. Our team of lawyers, professionals and occasional outside guests will take you through the most pressing issues facing businesses today and provide practical and actionable advice to help you navigate the ever changing legal landscape.
With a focus on innovation, collaboration and client service. We are committed to delivering exceptional value to our clients and to the communities we serve. And now our latest episode.
Welcome back to Womble Perspectives. Today, we’re diving into a case that’s raising questions about corporate compliance, whistleblower protections, and the future of deferred prosecution agreements.
A recent whistleblower lawsuit filed in New York State Supreme Court could have major implications for Freepoint Commodities, a Connecticut-based energy trading firm. The suit alleges insider trading violations and retaliation, and it comes just two years after Freepoint entered into a three-year deferred prosecution agreement with the Department of Justice for violations of the Foreign Corrupt Practices Act.
Let’s rewind for a moment.
In 2023, Freepoint agreed to pay over $98 million in criminal fines after being accused of conspiring to bribe a state-owned company in South America. As part of the deferred prosecution agreement, Freepoint committed to enhancing its corporate governance and compliance program and to report any future felony violations to the DOJ.
At the same time, Freepoint resolved a parallel civil enforcement action with the Commodity Futures Trading Commission. The Commission charged the company with unlawfully obtaining non-public competitive bidding information and confidential market intelligence. That settlement added another $61 million in civil penalties and over $30 million in disgorgement.
Now, enter Andrew Martin—a former senior analyst at Freepoint—who claims he was pressured by two senior executives to engage in illegal insider trading. According to Martin, these executives pushed employees to steal proprietary information from oil and gas producers and refiners. He says he raised concerns internally, even to the CEO, but was terminated just before an FBI site visit meant to assess Freepoint’s compliance with its deferred prosecution agreement obligations.
The timing and nature of these allegations could spell trouble for Freepoint.
Under its deferred prosecution agreement, Freepoint is required to report misconduct, cooperate with investigations, and remediate violations. If the DOJ finds that the company failed to meet these obligations—especially in light of retaliation claims against a whistleblower—it could lead to further investigation, additional penalties, or even an extension of the deferred prosecution agreement beyond its current 2026 expiration.
And while the DOJ has recently moved away from imposing compliance monitors, a confirmed breach of the agreement could bring that back into play.
So what’s the takeaway?
For companies under a deferred prosecution agreements, or even those simply aiming to stay ahead of regulatory risk, this case is a stark reminder of the importance of robust compliance programs. That means proactive audits, strong internal reporting mechanisms, and real protections for whistleblowers.
With the DOJ now offering incentives for whistleblowers to come forward, companies must be prepared to address both historical and emerging issues head-on.
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