Whistleblowing as Peak Experience

Whistleblowing as Peak Experience

In jobs we find our successes, most of them memorable only for ourselves.  We point to these events when we hope to justify the energy we expended and our failure to take care of other responsibilities and the people we disappointed.  Over a lifetime of employment, we can perhaps list a few occasions in which we did very good work, not perfect, not without some flaws, but still very good work.

My first year with HomeFirst – 2007/2008 – was, for me, one of those rare periods of success.  I had the opportunity to use skills that I had developed over the course of a career in financial planning, accounting, legal, compliance, and administrative management.  With the then-CEO and the Program Director, we collaborated to bring the company back from the brink of financial collapse.  We could have done more to put it on a solid footing, but we did a lot.

The years prior to that and afterward had their moments, but they were pallid in comparison.  They brought none of the adrenaline rush of that special year. 

Whistleblowers’ stories begin not with a courageous disclosure but with the banalities common to most jobs.  In my case, those included the usual monthly reports, budgeting, compliance work, and oversight of HR and IT, which I had done for 6 years at HomeFirst, 8 years at other nonprofits, 20 years (to varying extents) at for-profit companies.  And I anticipated years more of it until retirement.

Whistleblowing provides a release from quotidian work life.  Ellsberg described the excitement and tension involved in copying the Pentagon Papers and getting them to news outlets – the stuff of a 2003 movie.  Snowden’s capture and release of government secrets and his international escapade were the material for a better film.  Some whistleblowers[1] become spies-in-the-ranks, wearing covert recording devices to feed information to government investigators.  Some participate in sting operations for the arrest of wrongdoers[2].  We enter a world of secret collaboration with law enforcement officials.

We work, sometimes for years, to amass evidence to be used against suspected wrongdoers[3].  In one case, Charles Matthew Erhart began working as an internal auditor at BofI Holding, a large internet savings and loan association.  Over the next 18 months, he identified in his internal communications what he believed were more than 13 violations of laws and banking regulations.  His boss resigned in response, Erhart figured, to an order to commit an unlawful act.  Then Erhart blew the whistle to the Office of the Comptroller of the Currency, which regulated BofI, days before he was fired.

The HomeFirst misdeeds that I alleged were relatively small.  As Erhart did, I went on and on finding them.  Each deed called for investigations of laws or contracts and the compilation of financial information and, in some cases, client service information.  For months, I surreptitiously collected email communications of the CEO and Board members.

  

To mold the findings into evidence intelligible to others requires skills we have learned in many past assignments.  The process calls for nerve and courage because we know we will be punished if things go wrong and we cannot prove our contentions.  We have seen the results of failure throughout our careers and personal lives up to that point.

During the course of this information gathering, we are exhilarated by what we discover and believe that it will make a difference.  We may hope to right a wrong, improve the world, or get revenge. 

We deny being heroes in the capital-H sense of the term[4], but we believe that we are doing the right thing[5].  We may convert that belief into a mission[6] – on behalf of some disadvantaged group or whistleblowers in general – or, unfortunately, a very lengthy lawsuit[7].

Like other peak experiences, whistleblowing builds a momentum.  Once we are on a path of discovery, revelation, and response to retaliation, it is hard to stop.  Erhart saw clearly enough what kind of company and management he was dealing with after his first few audits; the characters I dealt with at HomeFirst were clear to me months before I was fired.  But we continued to work on our projects.

The energy that carries us forward can also partially blind us.  We may select evidence that is biased in support of our case – a possible reason why our complaints rarely lead to successful prosecutions of the wrongdoers[8].  We may fail to see the fair logic of our adversaries.

In our impassioned rush, whistleblowers underestimate or ignore the dangers of retaliation.  We are on a high that silent observers turn away from.  We might be cagier if we can avoid the intoxication of the whistleblowing project.  But mostly we are sucked in; we are slammed in the end despite laws and organizational policies that promise to honor our efforts.

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[1] For example, Erwin Hayes, Deborah Lourd, Melissa Reimer, James Thorell, John Verble,

[2] For example, Evelyn Graddy

[3] For example, Beverley Brown, Thomas Drake, Charles Matthew Erhart, Ilya Eric Kolchinsky, Robert Kraus, Thomas Sargent, Sanford Wadler

[4] For example, Sherron Watkins

[5] For example, Linda Gibbs, Kurt Kroening, Glenda Martin, Jeremy Romero, Patricia Williams, Rich Wright

[6] For example, Eric Ben-Artzi, Gretchen Carlson, Thomas Drake, a list of speakers offered by the Government Accountability Office (including Ben-Artzi, Drake, Ellsberg, and Watkins)

[7] For example, Robert Purcell

[8] Rush, Mark A, et al “Pennsylvania’s Proposed False Claims Act: Why Further Incentivizing Whistleblowers Is Unnecessary, Counterproductive, and Could Decrease State Recovery of Tax Dollars” fn 8; also my experience with HomeFirst.

Believing What Is Obviously Untrue

Believing What Is Obviously Untrue

By the time he felt forced to quit in 2015, Thomas Sargent had spent 24 years as environmental safety and health specialist at Sonoma (California) State University.  Except for a performance improvement plan issue in 2002, he had been a solid, technically skilled employee.  A 2013 report commissioned by the university found asbestos dust in some buildings, and later in the year a report from the State’s Office of University Auditor identified a few materials handling weaknesses at the university, including the need for hazardous materials inspections.  Sargent took that finding and ran with it.

For two years, Sargent pressed for management action on the issue and, he felt, they resisted.  He said the asbestos concentrations were really high, and the university said they were not.  The university paid for another inspection, which did not find a big problem, but Sargent said the inspection was faulty.  Money was not available to eliminate asbestos from the buildings, but the university took other actions, such as sealing surfaces, to contain the problem.

Relations between Sargent and his boss deteriorated.  Sargent reported violations externally.  He accumulated six reprimands and two suspensions.  Then he quit and sued the university.

In “Why We Believe Obvious Untruths,” Philip Fernbach and Steven Sloman suggest that all of us are ready to believe things that are patently untrue – for example, in the case of Donald Trump, the prevalence of voter fraud, extraordinary attendance at his presidential inauguration, the birth place of Barrack Obama – because we satisfy ourselves with what we think individually.  We refuse to accept the analyses of others who disagree with us.

Whistleblowers are among those who go off on their own to come up with their complaints.  That individual initiative in support of what they believe makes them so attractive to many.  But it is sometimes hard to know if they aren’t just crazy or motivated by some hidden agenda.

The university believed its evidence made its position patently true, and Sargent rejected that position, not unlike the way Donald Trump rejected evidence that no significant voter fraud existed in the 2016 presidential election.  It is difficult for nearly all of us to independently evaluate Sargent’s contention that potentially dangerous asbestos risk was present or the university’s contention that no significant risk existed.  We have trouble distinguishing the deluded from the honest reporters.

Something similar goes on with other whistleblowers.  Few readers of Edward Snowden’s documents could personally assess his claim that the government acted illegally.  When Sharon Watkins described reporting irregularities at Enron, they seemed suspicious but few could know for sure how improper they were.   No readers of my complaints can easily determine if I had a reasonable basis for presenting them or if HomeFirst was right in ignoring them.

Fernbach and Solman contend that what makes humans exceptional is not our individual mental capability, but our ability to think in concert with others.  You know that the earth revolves around the sun, but only by virtue of others’ astronomical observations and calculations.  You know that smoking causes cancer, but without knowing precisely the effects of smoking on our cells, how cancer develops, and why some smoke is more dangerous than others.

The problem, of course, is that groups also go cockeyed, believing things that are quite, even patently, untrue.  Anecdotes – the sun rising in the east each morning or a relative who lived to old age despite being a heavy smoker – may confuse us.  Religious doctrine leads some to make statements – for example, concerning the age of humanity – that are obviously inconsistent with reality.  Then, members of close-knit groups can fall prey to groupthink and ostracize those who challenge the group’s norms and beliefs.

Defending themselves, organizations commonly accuse their whistleblowers of not being able to get along with others in the group[1].  Sonoma State University said Sargent showed resentment and malice toward his manager and mounted a campaign to get him fired.  HomeFirst board members decided to fire me because I was insubordinate and a “loose cannon” who could not get along with others on the team.

In the Fernbach and Sloman framework, Sargent is the individual – operating alone as most whistleblowers do – who strongly believes what is, to the university, obviously untrue.  The university represents a community of shared knowledge that enables its members to feel that they understand things that, in Sargent’s view, they don’t.  The fact that group members – those in Sonoma State University, HomeFirst, or even the whistleblower community – affirm each other’s beliefs makes them feel smarter when they may really be quite dim.

Our natural state is ignorance, Fernbach and Sloman write, and we should be cautious and evaluate what we think.  If we care to find the truth.

Stepping away, even momentarily, from our irrationality to bathe in rational evaluation is problematic.  The whistleblower’s frustrations may bias his investigations.  The organization’s retaliation against its whistleblower takes place in an arena not of truth-seeking but of power plays.  Both sides are driven more by emotion than by reasoned analysis; they seek to win, not to be right. 

Organizations often retaliate quickly against those who break ranks to complain[2] rather than investigate the alleged problem.  A few hours after I revealed to HomeFirst that I had reported possible violations externally, the CEO and Board members decided I should be terminated and, on advice of their attorney, they lost interest in discussing whether the company’s actions needed correction. 

Communication between the whistleblower and the organization ceases.  Any collaborative search knowledge is abandoned.  The whistleblower is fired for insubordination and poor performance, an end that should have been seen early on. 

But on occasion, a court or a jury steps in to judge the matter and describe the truth when the parties are unwilling to do so themselves.  That was the happy ending for Thomas Sargent.

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[1] For example, Keith Allard, Ralph Bailets, Jason Blasdell,  Brandon Coleman, James Cryer, William Drake, Daryl DuPage, Kevin Gerity, Danny Hollister, Ronald Klym, William Plouffe, Stacie Plummer, Melissa Reimer,  , Brenda Taylor, Sandy Wadler, Barry Wilson, Brett Wingo

[2] For example, an unnamed Amtrak supervisor, Sandra Black, Anthony Tenny

Roles Overrule Reason

Roles Overrule Reason

Daryl DuPage began working for the Clay Township, a 9,000-resident community about 50 miles northeast of Detroit, around 1990.  He became Chief, the only full-time employee, of its Fire Department in 2002.  In 2014, he obtained a two-year, $691,980 federal grant from FEMA for additional fire fighter staffing in the Township.

In January 2016, the Township Clerk sent DuPage detailed expense information to present to FEMA for reimbursement under the new grant.  DuPage questioned the Clerk’s inclusion of $16/day/firefighter ferry fees for the trip to nearby Hansens Island, which he believed were not allowable under the terms of the grant.  The following quarter’s billing information did not include expense details, but in July DuPage again saw that ferry fees were included in the charge, even for firefighters who lived on the island and had not taken the ferry. 

On November 28, 2016, DuPage had a long conversation with the Clerk about how she had handled ferry charges and allocated health benefits.  He told her that her accounting for the expenses was wrong.  Then he approached Township Trustees to complain about the matter.  On December 12, he was fired because, he was told, he didn’t get along with anybody.  DuPage filed his wrongful termination suit against the Township on February 2, 2017.

Whistleblowers are often associated with big events – mass surveillance systems (Snowden), government deceptions about wars (Ellsberg & Manning), Big Tobacco’s efforts to make cigarettes even more addicting (Wigand), vast financial deceptions (Watkins at Enron).  But most whistleblowers’ complaints involve smaller matters.  Sometimes so small that interest in them nearly defies explanation.

DuPage confronted no great moral issue in his complaint about charging (maybe) a few thousand dollars a year of ferry fees to the grant.  He was no financial expert; he had little experience with government grants; he could have simply excluded the ferry fees from the reimbursement requests that he submitted to FEMA.

The relative insignificance of Dupage’s disclosure is not unique.  The majority of whistleblower accounts that have been reported over the past year are ambiguous examples of wrongdoing.  My own claims of HomeFirst’s misdeeds were disputed, and few were officially decided against HomeFirst.  Some were wrongs that I might have corrected myself[1], as DuPage could have done in his situation.  HomeFirst’s food handler card violation was even less significant than the Clay Township ferry fee misbilling.

On the other hand, DuPage’s complaint, each of mine, and those of other whistleblowers were based on honestly formed opinions of organizational violations of laws or contracts.  The organizations’ claims that they did not commit wrongs or that the actions were appropriate should not surprise anyone.

History presents many cases of far more offensive actions whose perpetrators considered them perfectly justified.  Serbian Slobodan Milosevic, who caused the deaths of more than 200,000 Croats, Bosnian Muslims, and Albanians in the 1990s, claimed repeatedly that he only responded to past aggressions against innocent Serbs.  In interviews, dictators – including Idi Amin, Jean-Claude Duvalier, Mira Markovic, and Jean-Bedel Bokassa – claimed that their crimes against their citizens were done for the good of their countries[2].  The narrative of the powerful – whether big- or small-time – includes a denial of guilt and a reframing of its accuser’s complaint.

After I admitted that I had disclosed two suspected violations, HomeFirst’s attorney advised the Board that I was following the standard steps for whistleblowers.  Shortly before firing me, the HomeFirst CEO told the Board that I was only trying to protect my job by setting myself up as a whistleblower.  Later, in its defense against my claim of retaliation, the HomeFirst attorney claimed that I was just crying whistleblower to escape the consequences of my own misbehavior.

It can be difficult to separate our “real” motivations from motivations implicit in the increasingly popular whistleblower role we fill.  Google searches of “whistleblower” have doubled over the past ten years, attesting to the attraction of the whistleblower narrative.  Edward Snowden won awesome fame just five months before I decided to become a whistleblower myself.  The whistleblower-protagonist can be an attractive role, especially to someone, like me at HomeFirst, who has become dissatisfied with the organization for any of a multitude of reasons.

The organization’s managers, too, find a role to play.  Within a few hours of my informing the HomeFirst CEO that I had disclosed potential violations to government agencies, the chair of the Development Committee declared that my disclosures amounted to insubordination, an argument that the CEO praised.  The job of the CEO and Board was to protect the company from enemies, and I was destructive of it, their attorney advised.

In our respective narratives, we have our quests – to do the right thing or to protect an indispensable organization; we encounter obstacles along our way; we have second thoughts about our undertaking; and we persist.  In so doing, we create ourselves[3].

There was no good reason why DuPage should have been fired for making much of the ferry fees.  Not after working for the Township for more than 25 years and recently obtaining a large grant to expand its services.  Nor was there good reason why DuPage should have been made a big deal out of the expenses.  They were no fodder for a splashy False Claims Act lawsuit.  They were trivial, and he might have gotten it wrong anyway.

There was no good reason for HomeFirst to fire me.  I was possibly months or at most a couple of years from retirement anyway.  I was generally competent and efficient, even if not always lovable.  HomeFirst came to no harm from my complaints, and they broke the law with my termination.  Nor was there great reason for me to go as far as I did reporting possible violations externally.  I had raised them often enough with the Board.  I might have gone on doing so without the public being injured.

Still, we fell into our roles – attracted by their popular images and impelled by our discomfort for life as it was – we blew whistles and were fired; they took offense and retaliated.  Reason and ethics had little to do with it.

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[1] I could have repaid the amount I overbilled the County of Santa Clara, or I could have refused to bill ineligible expenses on contracts requiring master leases.  Either action could have caused the company’s financial collapse, and I could have reasonably expected to be fired as a result.  But I could have done it.

[2] Tavris, Carol and Elliott Aronson.  Mistakes Were Made (but not by me): Why We Justify Foolish Beliefs, Bad Decisions, and Hurtful Acts. New York: Harcourt, Inc.  2007

[3] Bruner, Jerome.  Making Stories: Law, Literature, Life.  Cambridge: Harvard University Press.  2002

The Problem of Knowledge

The Problem of Knowledge

Those whom we accuse of organizational wrongdoing are sometimes quite clearly and knowingly guilty of the misdeed.  Debra Halbrook observed that two district attorneys in adjacent North Carolina counties each agreed to hire the other’s wife to work in his office, receiving full pay for less than full-time hours[1].  And Dr. Theodore Schiff figured out that from 2008 to 2014 dermatologist Gary Marder billed Medicare for medically unnecessary treatments.  After more than three years of litigation, the court ruled against Marder and he agreed to pay $18 million to the Department of Justice in settlement of the allegations[2].

On its turn, HomeFirst knowingly billed the County of Santa Clara and HUD for property rental expenses that were not contractually reimbursable.  In addition, the company knowingly rented apartments to individuals who failed to meet the requirements set forth in loan agreements covering the property.  The money HomeFirst improperly kept from HUD, the County of Santa Clara, and the City of San Jose was obtained innocently, but it was intentionally retained after the impropriety was identified.

Far more often, the accused disputes whether the alleged activities were violations at all, often in ways that critics, especially its accuser, consider disingenuous.  Paul Bishop and Robert Kraus observed that their bank employer (World Savings, acquired by Wachovia which was acquired by Wells Fargo) was misstating its financial position by moving mortgages off its balance sheet.  But the legality of this highly technical operation, which is reminiscent of the accounting fraud that contributed to Enron’s collapse, may be disputed by reasonable people, as Wells Fargo has done for five years and counting.

Or the accused may contend that the alleged actions never occurred at all.  In a recent case, Michael Bachmann and Sarah Steele claimed that the San Francisco Bay Area Air Quality Control District destroyed important documents concerning air pollution.  The District countered that the pair’s allegations had been investigated previously without finding any problem and that the destroyed documents had been duly scanned prior to destruction.

The licensing violation that I alleged HomeFirst had committed involved a technical question concerning when facilities need to be licensed under State law.  I could have been wrong, or the violation could have been, as things turned out, easily fixed, as was the food handler card violation.  What I thought might be illegal bid collusion turned out not to break federal law, but whether State law was violated remains uncertain.  Whether HomeFirst’s payroll tax and minimum wage stance toward homeless workers constituted violations of law is not determined conclusively although evidence so far points to HomeFirst’s innocence, at least with respect to State and local laws.

In her recent New Yorker article, “Why Facts Don’t Change Our Minds,” Elizabeth Kolbert discusses our tendency to attend most closely to information that supports our beliefs.  As a result of this confirmation bias, our own theories are resistant to change, and we are adept at finding flaws in opposing theories.  Our objective, some researchers conclude, is not a search for truth, but winning the argument.  Moreover, our brains are designed so that it feels good to stand up for what we believe, even if we are wrong. 

In whistleblowing cases, both the accused wrongdoer and his accuser are susceptible to the influences that Kolbert describes.  HomeFirst CEO Niklaus was confident that the government agencies' failure to demand immediate repayment of misused funds meant they approved of the situation and that my technical arguments about the alleged violations carried no weight against the good intentions of the company.

For me and most whistleblowers, I suspect, official indifference to our complaints is evidence of greater sympathy with the wrongdoers or incomplete investigations.  Maybe so, or maybe not so much.

The inclination on both sides to continue fighting for our causes, despite growing evidence that we will lose, can lead to absurd results.  For example, whistleblower Robert Purcell fought for 18 years against pump manufacturer MWI, and after his final defeat he still believed that a great injustice had been done. 

An accused-side absurdity: Sanford Wadler was general counsel of Bio Rad Laboratories, a position he held for 25 years, when he observed what he believed were violations of the Foreign Corrupt Practices Act.  After a couple of years of his questions and investigations, Bio Rad fired him.  Wadler sued under federal and State laws and won; Bio-Rad appealed; the case went on for three and a half years after his termination.   Although the company may appeal again, so far its loss is $14.5 million, including $3.5 million for Wadler’s legal costs.  That is in addition to the $14.35 million that it agreed to pay the Department of Justice to settle allegations of its violations of the FCPA.

Kolbert is not optimistic about the prospects for escaping our apparently inbred need to win these fights.  There appears to be small incentive for companies to change their ways – Bio-Rad’s stock price has increased more than 70% since it fired Wadler; if HomeFirst is ever called to pay anything to me, the amount will likely come from the insurance policies it held three years ago. 

Whistleblowers, too, stick to their current approach.  Despite warnings from Alford, Devine and others, more whistleblowers step forward each year, perhaps in response to more bad activities, ever-increasing rewards[3], or occasional news about whistleblower protections.

If we can move away from crazy situations – like whistleblower cases that stretch routinely for 4-plus years (and up to 18 years) or that can result in a $14 million whistleblower settlement – it will be the result of honestly discussing our errors and the things we don’t really know[4], not by devoting our energies to destroying the other side.

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[1] One of the wives quickly resigned when news got out, and one of the attorneys fell under investigation for a number of possible violations.

[2] Marder still denies the allegations (the DoJ concluded that all of Marder’s medical physicist service billings since 2011 were false) and plans to sue Schiff for defamation and libel.

[3] For example, payments per Dodd-Frank, IRS, and False Claims Act

[4] Cf. Tavris, Carol and Elliot Aronson.  Mistakes Were made (but not by me): Why We Justify Foolish Beliefs, Bad Decisions, and Hurtful Acts. New York: Harcourt, Inc.  2007.