WASHINGTON, D.C. | July 12, 2018—The Commodity Futures Trading Commission (CFTC) today announced its largest whistleblower award to-date in a commodity fraud case. According to the Commission, it issued “an award of approximately $30 million to a whistleblower who voluntarily provided key original information that led to a successful enforcement action” Continue Reading Largest Award Issued in Commodity Fraud Case
Today, we expect Wall Street to be as much a part of the community as Main Street. For corporations with social responsibility commitments and investor groups with social responsibility mandates, whistleblowers are a crucial force for compliance. Whistleblowers ensure that businesses play by the rules, including those that they’ve set for themselves, as part of their social responsibility commitments. As the number of whistleblower claims rise, both in quality and scope, the potential impact of these cases on socially responsible investing, and on companies committed to and impacted by such frameworks, needs to be placed in the spotlight.
The Pennsylvania Supreme Court issued a big decision for whistleblowers in Bailets v. Pennsylvania Turnpike Commission, 2018 WL 1516785 (Pa. 2018). The Court ruled that noneconomic damages are compensable under Pennsylvania’s whistleblower law.
Ralph Bailets was a former Manager of Financial Systems and Reporting with the Pennsylvania Turnpike Commission. During his tenure, he became concerned about the government contractor Ciber Inc., which was politically-connected to leaders of the Commission. When competing for one infrastructure project, Ciber offered the most expensive bid, yet still was chosen for the contract. As Ciber struggled to perform the contract, Bailets took the issue to his supervisor. Bailet’s supervisor initially warned him that Ciber had friends in high places, and later advised colleagues that Bailet “should be kept on a short lease.” He was fired shortly thereafter.
In his testimony before Congress last week, Facebook CEO Mark Zuckerberg received tough questions from members of Congress about wildlife trafficking and the illegal ivory trade on his two-billion user social media site.
At the Joint Senate Committee Hearing, Senator Chris Coons (D-DE) referenced a recent Time article examining illicit wildlife crime on Facebook, stating, “wildlife traffickers are continuing to use Facebook tools to advertise illegal sales of protected animal parts.” Zuckerberg responded, “we’re going to have more than 20,000 people at the company working on security and content review.”
Will Kramer knows what it means to be a whistleblower. As a former investigative staffer in the Senate, Kramer has ample experience working with whistleblowers. Later while serving as a health safety consultant, Kramer became one himself when he uncovered deeply disturbing conditions and improper handling of hazardous waste at several Greif Inc. plants. Kramer reported potential health, safety, environmental and securities violations to government regulators, members of Congress and the news media after the plants failed to address these issues. Now, as a law student, Kramer has written an important piece on the whistleblower mindset.
In Digital Realty Trust v. Somers the Supreme Court issued a destructive decision that will have far-reaching consequences for whistleblowers. Seemingly unaware of the practical consequences of its decision, the Supreme Court unanimously ruled to leave whistleblowers who report internally without critical protections under the Dodd-Frank Act.
Writing for Law 360, NWC Executive Director Stephen M. Kohn explains that employees now take grave risks in using internal compliance programs. In light of the Supreme Court’s decision, whistleblowers should hire an attorney and take their complaints directly to the Securities and Exchange Commission (SEC).
Following Wednesday’s devastating Supreme Court decision in Digital Realty Trust, Inc. v. Somers, whistleblowers were in need of some good news. The Tenth Circuit answered the call yesterday with a solid decision in Gensberg v. Porter affirming an amicus brief submitted by the National Whistleblower Center.
Carl Genberg was an executive for the Ceregenix Corporation who suspected misconduct by the Board of Directors. When he suspected misconduct including insider training, he reported this to the Board. As a result of his actions, Genberg was fired. Yet when he brought a whistleblower suit before a federal district court, the judge dismissed his case upon a summary judgment motion by Ceregenix.
Picture this: while at work you become aware of conduct that you believe is unethical, illegal, or qualifies as government waste, fraud, or abuse. You decide you want to blow the whistle. But before you act, be careful! Most corporate and government networks log traffic. Your work computer and phone are not private. When you use a company or department computer, assume everything you do is monitored. These computers are an easy way for your employer to determine you are the whistleblower.
Last week, the Department of Justice announced that it collected $3.7 billion in settlements and judgements from False Claim Act (FCA) cases against the government in 2017. The FCA is a statute that allows individual whistleblowers, called relators in this context, to file lawsuits on behalf of the government.
Known as Lincoln’s Law, the FCA was originally passed in the Civil War when avaricious contractors supplied the Union with faulty weapons and failing supplies. Over the last decade, FCA cases filed have grown in number and become one of the government’s premier tools for policing corporate fraud.
The National Whistleblower Center released a new video featuring four prominent whistleblowers who share their personal stories of blowing the whistle and the backlash they faced for doing the right thing. “Whistleblowers Change the World,“ highlights the crucial role whistleblowers serve in exposing corruption at all levels of society and why we need a sustained grassroots movement to ensure the legal protections they require are upheld.