Reacting to Whistleblowers
“I Said Get Rid of That Son of a Bitch!” Richard Nixon, January 31, 1973
The defining moment, rather person, of the whistleblower era was most certainly Deep Throat. Deep Throat is the pseudonym given to the secret informant who provided information in 1972 to Bob Woodward and Carl Bernstein were reporters for The Washington Post, and Deep Throat provided key details about the involvement of U.S. President Richard Nixon's administration in what came to be known as the Watergate scandal. “This guy that was fired,” Nixon bragged in a Jan. 31, 1973, taped White House conversation. “I said get rid of that son of a bitch.”
Ken Lay, Enron CEO, when given details about the accounting scandal at his firm that caused it’s fall and loss of billions of dollars in shareholder equity by an anonymous whistleblower, innocently asked why nobody had come to him directly with the information sooner. Later in his trial and conviction it was made clear that not only did he know but profited greatly off the deceit.
John Michael Gravitt became the first individual in 40 years to file a qui tam lawsuit under the False Claims Act after the statute had been weakened in 1943. Gravitt, a machinist foreman, sued GE for defrauding the United States Department of Defense when GE began falsely billing for work on the B1 Lancer bomber. Gravitt was laid off following his complaints to supervisors about the discrepancies. The case of Gravitt v. General Electric and Gravitt's deposition to Congress led to federal legislation bolstering the False Claims Act in 1986. The amended Act made it easier for whistleblowers to collect damages. Gravitt's suit proceeded under the 1986 amendments and GE settled the case for a then record $3.5 million.
Douglas Keeth filed a qui tam lawsuit against United Technologies Corp. (UTX) where he held the title vice president of finance. Mr. Keeth and others had investigated billing practices at UTX's Sikorsky Aircraft division, uncovering inflated progress billings going back at least as far as 1982. UTX offered Mr. Keeth a $1 million severance payment if he would keep quiet, but Keeth rejected the offer. In 1994, UTX paid $150 million to the government and Keeth was awarded a bounty of $22.5 million.
We can see how these all ended – vindication for the whistleblower and collapse for the perpetrator. But the lesson we should take from history is not a simple one. Nor easy. First, as I was criticized for my blog post “The Best Defense Against Me Too” as a trap because as I had thought, many harassers would reach out for tips to avoid paying the price for their misdeeds and were angry when my blog pointed out that the best defense against #METOO was to treat all employees equally, to not pray on female employees sexually, and to exemplify high moral character and to expect the same from your leaders.
So it should not surprise readers of my blog that I have similar guidance for executives on how to best deal with a whistleblower – simply put, do right. Sounds simple. Sounds a little boy scout and apple pie I know. But it’s not simple, it’s hard. Especially for a leader of an organization because our behavior and moral conduct must be above reproach – not entitled. It is that moral imperative that creates the culture where employees can freely report instances of fraud, abuse, discrimination, and harassment with fear of reprisal.
More and more frequently, whistleblowers make the headlines and when your company or agency is the target of the allegation it can be devastating for you personally, your reputation, financially and even result in incarceration. Avoid being a target, by being a role model – and not a faux role model who takes moral high ground and at the same time skims, lies and is a predator. A real role model. Be honest in your dealings with others. Treat female employees as if they were your daughter. And model behaviors to the rest of the managers in your company that respect the rights of the whistleblower, take their claims seriously and address the issue…. don’t shoot the messenger.
The ETHIX360 blog brings you weekly updates on all things human resources and compliance.
MEET THE AUTHOR
J Rollins is the co-founder and CEO of ETHIX360. J is a well known leader and innovator who has served on senior leadership teams ranging in responsibility from Chief Revenue Officer, Chief Marketing Officer, SVP of Product Strategy and Chief Operating Officer.
ABOUT ETHIX360
At ETHIX360, our goal is simple: to provide an affordable, flexible, and comprehensive answer to employee communication, policy management, corporate training and case management on issues related to corporate ethics, code of conduct, fraud, bribery, and workplace violence.
