As Fraud Fight Heats Up, Efforts to Protect The Whistleblower Increases

10/29/2012 // San Francisco, CA, USA // Whistleblower Law Firm // jeffrey Keller // (press release)

(Whistleblower Lawyer News) US – With increased scrutiny on deficits and government funding in recent years, efforts to fight fraud and wasteful spending have become critically important in every aspect of our economy. The key tools in this fight are whistleblower laws that encourage those with knowledge of fraud – especially fraud on the government, to step forward and expose it. However, as more employees consider taking steps to expose wrongdoing, they are increasingly facing retaliation in the workplace. Such is the finding of a new study revealing high rates of retaliation against employees who report corporate misconduct.

The study, released Sept. 9 by the nonprofit Ethics Resource Center, found that nearly half of the 4,700 workers surveyed — 45 percent — had observed misconduct in the course of their employment. Nearly two thirds of these workers — 65 percent — reported it. “These are staggering statistics,” says Jeffrey F. Keller, a founding partner at Keller Grover, a nationally recognized labor and employment law firm, and a veteran whistleblower lawyer. “The survey makes clear that there is a lot of fraud and bad behavior that needs to be stamped out.”

The study also found that 22 percent of U.S. workers who reported misconduct to their employers experienced a negative consequence for coming forward. That’s an increase from 15 percent in 2009, the organization said. Traditionally, whistleblower retaliation can include demotions, pay cuts, transfers, or stalled promotions or raises.

Given these numbers, it’s imperative that these whistleblowers also know that there are laws designed to protect them , says Keller. “It’s important that employees know this, that they realize that they have recourse if they are punished for speaking out,” says the whistleblower attorney. “In light of these numbers, we have to get that message out, to let workers know there are laws that specifically contemplated exactly what they are going through and that there are lawyers ready to use those laws to help them.”

The gold standard of whistleblower laws is the federal False Claims Act, which dates back to the Civil War era, when wartime fraud against the government was rampant. It offers financial incentives to the whistleblower for calling attention to fraud on the government. The law was substantially modified in the mid-1980s, and among the additions were provisions that protected whistleblowers from retaliation by their employers. Congress re-visited the False Claims Act in 2009 and 2010. Both times, it took steps to continue to safeguard the financial incentives whistleblowers receive and to keep ahead of efforts to quash these important sources of insider information through unlawful retaliation. It’s a war on fraud, says Keller. “Congress takes steps to strengthen the government’s ability to recoup money taken from it improperly. Those committing the improper acts try to take counter-measures to keep up their improper revenue stream. It’s the ultimate game of cat and mouse.”

While the False Claims Act covers cases of fraud against the government, provisions in 2010’s Dodd-Frank Wall Street Reform and Consumer Protection Act cover fraud against shareholders, and offer employee-whistleblowers protection from retaliation.

“In the past few years, in particular, we have seen just how potent the whistleblower laws are in fighting fraud, recovering billions of dollars and rooting out a lot of corporate malfeasance,” says Keller, whose law firm is based in San Francisco and Los Angeles. “The good news is that the growing array of potent anti-retaliation laws can only help in the larger effort to put an end to the underlying bad behavior, too.”

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