Securities

Tension Between Corporate and Government Whistleblowing Programs

Whistleblowing is considered the most effective method of detecting large corporate frauds. For example, Cynthia Cooper and Sharon Watkins are famous whistleblowers who spilled the beans on the frauds at WorldCom and Enron, respectively. Unfortunately, the corporate world, and society in general, hasn't always treated whistleblowers as heroes. In fact, many whistleblowers are blamed for the negative effects of fraud (such as job layoffs) when fraud comes to light. For example, Cynthia Cooper experienced this and speaks about being shunned by the people in her town after she brought WorldCom's massive fraud to light. Basically, society seems to perpetuate the Kindergarten stigma of being a "tattle tale" and, as a result, they shoot the messenger when it comes to reporting fraud.

Read the full article, "Tension Between Corporate and Government Whistleblower Programs" in its entirety on FraudBytes.

 

For More Information:

Dodd-Frank whistleblowers are discussed in greater detail in 2 A.A. Sommer Jr.,  Federal Securities Exchange Act of 1934 Sec. 9.12 (Matthew Bender Rev. Ed.), "Specialized Treatment of Illicit Insider Trading," which can be accessed online by subscribers of lexis.com.  This treatise is also available on the LexisNexis online store