Whistleblower Protection Blog : Whistleblower Lawyer & Attorney : National Whistleblower Legal Defense and Education Fund : Whistleblower Protection, Fraud Claims : Washington DC

This Sunday's Washington Post featured an article that details Bradley Birkenfeld's actions as a whistleblower, and how those actions landed him in federal prison. The article discusses the contradictory messages sent to potential whistleblowers by the U.S. government:

Birkenfeld's story turned into a cautionary tale for would-be informants and a test of the U.S. government's attitude toward them. Should people who come forward with inside knowledge of a crime be rewarded, punished -- or both? Can the government simultaneously woo such whistleblowers with financial enticements and threaten them with incarceration?

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Richard Renner recently posted discussion of BB&T's refusal to reinstate whistleblower Amy Stroupe. An article, appearing today on Thebigmoney.com gives us a more in-depth look at the case. While working at BB&T bank, Stroupe was an investigator who uncovered a $20 million ponzi scheme. Discovering potential real estate fraud, she informed her superiors and persistently pursued the case.  As a result, she was terminated.

Joseph Yohe, a former regional fraud manager for BB&T testified during the case that the bank had a “double standard” when it came fraud committed by tellers as opposed to top income-producers.

You can read the article here.

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The Occupational Safety and Health Administration (OSHA) announced on Friday that it has found that New Jersey based air carrier Worldwide Jet Charter LLC retaliated against one of its pilots. OSHA has issued a reinstatement order, and this order has immediate effect even if Worldwide chooses to appeal. OSHA made its determination under the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century, which is also called AIR 21. "Pilots and other workers of air carriers have the legal right to report violations of federal aviation regulations," said Robert Kulick, OSHA’s regional administrator in New York. "Air carriers that retaliate against employees for exercising their rights under AIR21 will be held accountable." OSHA did not release the name of the pilot, but it did announce that its determination provided for back pay, compensatory damages, attorney fees, expungement and an order to post a notice to employees about their rights under AIR 21. This announcement follows another OSHA determination in March for a SOX whistleblower, indicating new hope for whistleblowers about the pace and success of OSHA whistleblower cases.

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Business Ethics magazine is reporting on the anticipation of corporate lawyers for more work in defending corruption cases.  In an article yesterday, Michael Connor writes about a whistleblower reward provision in the current draft of the financial reform bill. The bill would guarantee a reward of up to 30% for whistleblowers who provide original information about violations to the Securities and Exchange Commission (SEC). This reward program will be similar to the provisions of the False Claims Act (FCA) which brings billions of dollars back to the U.S. treasury every year through disclosures made by whistleblowers. (See page 9 of the linked report.) Connor says that if the financial reform bill passes with the current whistleblower provision, it would lead to increased detection of violations of the Foreign Corrupt Practices Act (FCPA) which provides penalties for U.S. companies that engage in bribery. Connor cites reports by corporate defense firms Morgan Lewis and Latham & Watkins indicating that the nature of enforcement is likely to change with the whistleblower reward.  Instead of raising disclosures internally, whistleblowers will be more likely to file disclosures with the SEC in hopes of securing a reward for the first to disclose original information.  Company managers are then more likely to learn about the allegation from the SEC rather than from a company hotline. The whistleblower could actually be competing with company management to see who can make the first disclosure and reap the statutory reward. One way company managers could keep whistleblowers reporting internally would be to demonstrate that company management will not tolerate any retaliation against whistleblowers. It would be nice of companies had such an incentive.

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