Hope and its Absence
The time required to resolve whistleblower complaints calls not
only for perseverance but for a facility with hope and hopelessness in the situation. An expectation of success is often an
important motivator for the potential whistleblower[1],
but success is rarely achieved[2]. As we proceed through our whistleblowing
projects, we must anticipate that we will fail to achieve our objectives.
I identified HomeFirst’s violations
of “master lease” requirements in three government contracts – two with the U.S. Department of Housing and Urban Development (HUD) and one with Santa Clara County – during my routine compliance reviews in
October and November 2013. In the
contracts, HomeFirst provided financial assistance to clients who were leasing
apartments. In 2013, the contracts
changed from those in prior years by requiring that the leases be in
HomeFirst’s name, not the clients’. Only
these “master leases” would generate eligible leasing expenses that HomeFirst
could charge to HUD or the County. In my
review I found that very few of the leases were master leases. As a consequence, we had violated the
contracts by charging HUD and the County for ineligible expenses.
The HomeFirst CEO asked the Program Officer to contact HUD
in San Francisco and get a waiver for the violation. Months passed, and no waiver came; HUD was working
on it, the CEO said. As CFO, I included
ineligible expenses in our invoices to HUD and the County while informing them
how much we were overbilling them. Then
in June 2014, I was fired.
During my time at HomeFirst, I made no external complaint
about the violations because I hoped that management would fix the
problem. I hoped that HUD would agree to
waive the violations.
For the first several months after being fired, I worked on
my other complaints and with my attorney on a response to my termination. We had overbilled the County more than $200,000
and HUD by over $100,000, but I did not gather documents to support my
complaint before I left. As a result, I
lacked specifics about the violations, such as the names of clients without
master leases and the amounts billed to HUD and the County for those clients.
By early 2015, the HUD Office of the Inspector General (OIG)
had apparently ignored my three complaints about the $1.2 million that HomeFirst
overbilled HUD in 2003-2006, and my two appeals to Senator Feinstein on
the matter had come to nothing. I did
not bother with the master lease violations, thinking it unlikely that anything
could be done about them. A year later,
the State
investigator of my whistleblower complaint showed little interest in the
master lease violations because I had no evidence of reporting them to authorities
while I worked for HomeFirst.
In 2016, my requests for public documents from the County,
the City of San Jose and HUD about other complaints began to yield information
that revealed the slow enforcement process years working after the initial whistleblowing.
In September 2016, I asked the County for HomeFirst’s master
lease contract billing information that I thought would reveal the 2014 charges
for ineligible expenses. The 266 pages of
County documents included a letter
from the HomeFirst CEO which admitted to charging the County $263,162 for ineligible
expenses. The documents also suggested,
without proving conclusively, that the County had charged HUD for those same
ineligible expenses. Excited at finding
probable evidence, at least in my mind, of the County’s seemingly fraudulent
billing of HUD, I registered my complaint on the County’s whistleblower
website. A week later, after receiving no
response from the County, I filed a similar complaint with the OIG.
Also in September I made a Freedom of Information Act
request to HUD for documents relating to its three contracts with the County
and HomeFirst. HUD agreed to provide the
material if I paid them $546 for 10.5 hours of their time spent complying with
my request. The City of San Jose, the
County, and HUD itself had not charged me for my earlier FOIA requests. Since I had received from the County what I
needed concerning their contracts, I revised my request asking only about the
HomeFirst contracts. HUD revised its invoice
to $126. [I subsequently asked them to
waive the fee in the public interest.]
My reluctance to pay even the lower amount may reflect my
lack of commitment to this whistleblowing venture. Or it may measure my optimism that the
blowing a whistle on this would do any good.
HomeFirst has changed its management and probably its procedures in the
past three years. Based on how it
handled the $1.2 million overbilling, the OIG will probably refer my complaint
to the San Francisco office, and the $300,000 to $400,000 of overbillings on
the three contracts may be within the authority of the San Francisco office to
forgive.
Even though I do not have all the specifics, I will file my
complaint with the OIG on HomeFirst’s violations, as I did my complaint about
the County. I will point out that,
combined with the earlier overbilling, HomeFirst-related violations amount to
over $1.5 million. But I don’t expect
that anyone will care really. Hope is
not the issue for me.
Nor was hope an important factor for me in most of the
whistleblowing I did while still employed at HomeFirst. By the time of my first external complaint, I
was pretty sure that HomeFirst would not correct itself. I soon decided that the authorities would
stand by HomeFirst, not me. With each
complaint I thought there might be a chance that a wrong would be fixed, but mostly
I was fed up with the situation and with standing by idly watching it continue.
I am now years removed from my initial whistleblowing, and I
was not harmed as much as others whose stories I have read. I would like to achieve some good with my
whistleblowing. But I have always been more
concerned with what will happen to me if I do not act – who I will be if I do
not add my small efforts to the fight.
[1]
For example, Duska, Ronald, Brenda Shay
Duska and Julia Regatz. Accounting Ethics. Malden, Mass.:
Wiley-Blackwell. 2011; Moberg, Daniel J. “The
Organizational Context of Moral Courage: Creating Environments That Account for
Dual-Processing Models of Courageous Behavior.” In Moral
Courage in Organizations: Doing the Right Thing at Work. Debra R. Comer and Gina Vega (eds.) Armonk, N.Y.: M.E. Sharpe. 2011.
188-208
[2]
For example, Moberly, Richard. “Unfulfilled
Expectations: An Empirical Analysis of Why Sarbanes-Oxley Whistleblowers Rarely
Win.” 49 William & Mary law Review (2007): 65-155; Devine, Tom and Tarek F. Maassarani. The Corporate Whistleblower’s Survival
Guide. San Francisco: Berrett-Koehler Publishers, Inc. 2011; Modesitt, Nancy M. “Why
Whistleblowers Lose: An Empirical and Qualitative Analysis of State Court Cases.” 62 Kansas Law Review (2013):
165-194
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