Shocking Rise in Whistleblower Retaliation within U.S. Corporations

Nation’s Top Whistleblower Attorney Recommends Wall Street Whistleblowers File Confidential Reports Directly to SEC

The Wall Street Journal reports that retaliation against U.S. workers who report suspected wrong-doing within their companies is occurring “in ever-greater numbers.” The report is based on a survey conducted by the Ethics & Compliance Initiative(ECI).

According to the report, Sixty-nine percent of those responding to the survey said they reported misconduct, up just 5% since 2013. However, the rate of retaliation against employees for reporting wrongdoing doubled since 2013. ECI states that “reporting and retaliation rise and fall together,” which makes that fact that in 2017, retaliation rose significantly higher than reporting – a 100% increase as opposed to a 7% increase in reporting, which is very concerning.

ECI reports that the “single biggest influence on employee conduct is culture.” Yet only one in five employees indicate that their company has such an environment.

The ECI reports that its findings are troubling, “because increases in pressure have shown to precede a weakening of ethical cultures. As that happens, as already shown in this report, conduct worsens. After nearly a quarter of a century studying employee perspectives of ethics in the workplace, ECI has shown that companies can curb the negative impact of external forces, such as the economy, by taking steps to strengthen their cultures.”

“Employees who report fraud are subjected to retaliation. Their best defense is to report their allegations anonymously to the SEC. If the company does not know who you are, they cannot retaliate. Our experience with the SEC, and its practice of protecting whistleblower-sources has been very favorable. They take confidentiality seriously, and are committed to protecting whistleblowers,” said Stephen M. Kohn, the author of The New Whistleblowers Handbook and a partner at the whistleblower-rights law firm of Kohn, Kohn and Colapinto, LLP.

The chief executive of ECI, Pat Harned noted, “the minimal progress companies are making at creating cultures their employees think are strong and grounded in good values. About 21% said they work at a company with a strong culture, up from 18% in 2013.”