Study Finds Benefits to Whistleblower Complaints for Corporations

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A study from the University of Iowa indicates that financial wrongdoing within corporations tends to see a marked decrease after a major whistleblower complaint. Researchers looked at various companies’ financial reporting after they were involved in alleged improprieties. The data in the study was from the years 2003 to 2010.

This was the first major study that examined the impact of whistleblower complaints on the businesses and organizations engaged in wrongdoing — and how they responded in the years following.

A sensitive issue for businesses

While there are more incentives than ever for whistleblowers, these individuals continue to face certain risks when coming forward. Employers may retaliate against them, threatening to demote or terminate them — and they sometimes follow through with those threats. Others may simply ignore the whistleblowers’ internal complaints, which can backfire significantly if the individual decides to report the complaint to a regulator or file a lawsuit against the company.

The U.S. Securities and Exchange Commission (SEC), for its part, has an Office of the Whistleblower that provides awards to any whistleblowers who make complaints resulting in enforcement actions of $1 million or more. The program, approved as part of the Dodd-Frank Act of 2010, has distributed more money on a year-by-year basis since its creation in 2011. Successful whistleblowers may receive 10 to 30 percent of the fines issued against the offender.

If you are aware of legal or ethical violations occurring within your business or organization, you may be eligible for a reward from the SEC or another regulatory agency. To learn more about your options, meet with a knowledgeable Dallas attorney at Whistleblower Law for Managers.

By Steve Kardell | Published March 9, 2017 | Posted in Whistleblower Litigation | Tagged benefits of whistleblower complaints

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Testimonials

"Steve Kardell was terrific in representing me in some very adversarial discussions with Citigroup and also later represented me in my testimony before the Financial Crisis Inquiry Commission." -Richard Bowen, Citigroup Whistleblower
"Incredible knowledge of employee related concerns and equally brilliant knowledge of health care regulations, standards of practice. I would recommend this firm to anyone." -V.B.
"Reaching out to Steve Kardell was the best decision I made. His ability to provide immediate insight and direction was very powerful, and a huge relief during a very stressful time period. For anyone struggling with a whistleblower situation, I would highly recommend at least speaking with Steve. After a 10 minute call with him, I had a better understanding of what I was dealing with. Even better, he gave me some immediate hope. In the end Steve did a better job than I thought was possible. Steve was able to get in contact with people in my organization, that I didn’t have access to. Because of his years of experience, he already has contacts in many organizations in Dallas. The entire situation was handled peacefully. I was impressed by his ability to “keep the peace”–rather than creating a battle with the organization. The reason I didn’t reach out to a lawyer initially, was because I thought it would mean an immediate end to any hope of a positive relationship with the company. Steve was able to address my concerns, and in the end I was able to continue to work for them." -KS
"Never thought my career would end like it did after 30 years of service. I was part of the first round of the so called reduction of force. I asked myself how can I be part of this with 30 years of seniority. How did they pick these 90 plus employees? Now, the culture of this organization made you question every decision they made. It wasn’t what you knew it’s was a culture of who you know. Nonetheless, I did not accept their severance package. I immediately starting looking for an attorney who would take on my case. After the initial call to Steve I had hope again. He was open and honest about everything and reassured me he would do his best for me, and he did. I had an awesome outcome. Thanks Steve you’re the best." -S.S.