High Profile Whistleblowers Are Changing Business

Whistleblowers are an integral part of the new, compliance-focused corporate governance model. They help executives identify problems, eliminate the need for costly legal settlements, and garner trust with consumers. While many corporations don’t invest in a valuable ethical program, most major companies and government agencies have come to rely on the results of recent public whistleblowers. Here are their stories.

Chelsea Manning and WikiLeaks

Former Army Intelligence Analyst Chelsea Manning (born Bradley Edward Manning) made national headlines when she released more than 250,000 U.S. Department of State diplomatic cables and 500,000 U.S. Army reports detailing the 2007 Baghdad airstrike and other classified diplomatic and intelligence reports.

While Manning was sentenced to 20 years in prison, the Department of Defense declared in a special report that national security was not impacted as the reports were minor in nature. President Barack Obama expanded the government’s whistleblower program to prevent future breeches. He also pardoned Manning December 2016.

Sherron Watkins and Enron

Sharron Watkins is an unusual whistleblower. She was one of the Enron vice presidents during the infamous bankruptcy scandal that caused many executives to face criminal charges. She approached the CEO about accounting issues and possible coverups. Her memo reported hidden debts and untruthful commodity reporting. The president told her he didn’t thing there were any issues but would investigate.

Critics claim she didn’t do enough and should have reported the incident to government authorities. They compared it to alerting a drug dealer about a police sting. However, Watkins did testify before a Congressional Hearing about the recordkeepers and executives. While she didn’t blow her whistle very loud, she did report the incidents.

Carmen Segarra and Goldman Sachs

U.S. New York Federal Reserve Regulator Carmen Segarra learned the hard way that government agencies get their way, even at the cost of their most important agents. She investigated the conflict of interest between Goldman Sachs and El Paso Corporation during the former’s merger with Kinder Morgan. Segarra ruled that there was no conflict of interest, even though Goldman Sachs owned $4 billion worth of stocks in El Paso.

The Federal Reserve ordered her to falsify reports and determine the case as a conflict of interest. Segarra asserted her position and was later fired. The Federal Reserve denies any wrongdoing or retaliation. This case drew attention to the retaliation problem facing many whistleblowers. While no direct changes were made to the agency, it catalyzed changes across the public and private sectors.

Ethical Advocate helps businesses protect their company by providing hotline solutions and training. Learn more about how a whistleblower program can save your company money.

Image: Wikimedia Commons, U.S. SEC Office of the Whistleblower