Whistleblowers Become the Accused

Whistleblowers Become the Accused

When we blow the whistle, we expect trouble.  We just don’t know its full extent.

Blowing the whistle usually leads to some form of retaliation.  That’s to be expected.  We broke the group’s rules.  We betrayed our boss or coworkers by exposing someone’s mistake or an outright wrong.  We blew the whistle on our team.

We expect to be shunned.  At times throughout our lives we’ve been rejected when we offended others.  Or we have snubbed another when he annoyed us.

In business it’s natural to make these punishments financial.  By refusing her a promotion, a pay raise or overtime.  By relocating her office.  We can be shocked when positive performance reviews turn negative, but that is a conventional way to send a message.  You don’t belong here.

In some industries the injuries can become physical.  It happens in law enforcement.

We can even expect to be fired.  We are shocked, offended, but not entirely surprised.  Many of us have fired people in the past.  We can’t be naïve.

We know that our boss will not give us a good job reference when we resist company misbehavior.  Some whistleblowers drop the company from their resume and their linkedin page.  That gets tricky when it leads to misstating job histories.  We work around the problem.

Those are all issues we can anticipate because we have worked in organizations for years.  But there are legal troubles we don’t usually anticipate.  They can be nerve wracking and expensive.

Debra Halbrook worked as a legal assistant for a North Carolina district attorney.  The guy was offensive, the way he always carried his Glock and disrespectfully adopted images of her strict Christian faith.  She reported behavior she thought was wrong to State authorities.  The DA fired her.  She sued.  Her attorney went full bore.  He charged him with wrongful termination but also with racketeering offenses, obstruction of justice, civil conspiracy, and more. 

Now the DA has gone after Halbrook and others.  His suit charges Halbrook with racketeering, obstruction of justice, and civil conspiracy.  He also sued her attorney for abuse of process.  Pursuing a whistleblower lawsuit can be expensive, but defending yourself against a rabid former employer involves costs you never imagined.

Others have been sued over their whistleblower claims.  Theodore Schiff won his FCA suit against dermatologist Gary Marder, who settled with the Department of Justice for $18 million.  Marder said he would sue Schiff for things he had said.  MJS and Associates, a health care consulting company, lost $65 million in an FCA suit brought by Matthew Master.  It then sued Master for breach of contract and breach of fiduciary duty, among other things.  Fortunately for Master, a court dismissed the suit.

Sometimes companies sue employees for their whistleblowing actions before they were fired.  Nick Ramler’s former employer claimed he tried to use his evidence of wrongdoing to blackmail his boss into not firing him.  Todd Barretta, chief compliance officer for NJ Transit, was sued for breaching his duty of loyalty to the agency.  Elderick Brass, a former prison guard, was charged with a felony for releasing a video of a guard firing a tear gas canister at an inmate.

Organizations always try to justify firing the employee for reasons unrelated to whistleblowing.  That can protect them from the eventual wrongful termination lawsuit.  And the wrongs they find can prove expensive for the whistleblowers.

Johnny Burris accused JP Morgan of pushing its investment products to customers for whom they were inappropriate.  The bank fired him, and he sued.  As justification, the bank said Burris misused JP Morgan letterhead paper and he failed to execute a customer trade causing the customer to lose $624.  Fighting that charge at FINRA cost him $50,000 plus the $5,000 fine.

Megan Elizabeth NIsewarner called out contract irregularities in her school district among other wrongdoings.  Unfortunately, a search warrant resulted in finding marijuana in her home.  Possession charges were eventually dropped, but the district still used the discovery as reason for firing her.

If the whistleblower loses her suit, losses can mount.    Parsippany (NJ) township charged James Carifi illegally downloaded files he used as evidence of misdeeds.  He had to defend himself against that.  Then when he lost his whistleblower suit, he had to pay the township $164,000 for its legal costs.  Janice Marrin claimed her complaints about lax hospital procedures led to her being fired.  After she lost her lawsuit, she was ordered to pay the hospital’s defense costs.

Organizations like to hold the threat of lawsuits over former employees who might talk about their cases.  HomeFirst proposed a settlement agreement to me that barred me from discussing the settlement or my employment with HomeFirst.  A friend of a friend of mine settled with a large bank that insisted on nondisclosure.  The bank requires annual depositions to make sure she hasn’t discussed it with anyone.  Otherwise she can deal with them in court.

I refused HomeFirst’s settlement, but still it blustered.  When I continued to follow-up on my complaints about its behavior, it sent me a letter threatening legal action.  I did not stop, and I never heard from it again.  The California Bar said the HomeFirst attorney had the right to threaten legal action if I defamed the company.  But, of course, that was not exactly the warning its attorney intended.

Sometimes whistleblowers are burned when they don’t stop.  Blue Shield of California fired Michael Johnson after he complained the nonprofit behaved more like a for-profit company.  Johnson has continued to be publicly vocal.  And he battles Blue Shield’s lawsuit trying to get him to stop revealing what it considers confidential information.

When we start on our whistleblowing ventures, we envision a limited field of action.  We simplify.  We see ourselves as moral champions, not as dissatisfied and a little vengeful.  We ignore the fact that the organization will quite reasonably seek its own revenge against us.  Its attacks will be fueled by resources we cannot always match.  It will attempt further acts we don’t imagine.

Significance in Retrospect

Significance in Retrospect

Jesselyn Radack, joined the Department of Justice after graduating from Yale Law School in 1995.  In 1999 she moved to DoJ’s Professional Responsibility Advisory Office.  She felt forced out of the DoJ in 2002 following her involvement in the government’s interrogation of John Walker Lindh, an American citizen captured with Taliban forces in Afghanistan.  She became a very public whistleblower.

In her telling, the story was straightforward.  She was asked whether Lindh could be interrogated without an attorney being present.  She advised, no, not under U.S. law since his parents had secured an attorney for him.  The FBI went ahead and interrogated him anyway.  Her boss suggested she leave or else.  Lindh’s attorney’s later requested copies of relevant DoJ communications, but DoJ didn’t provide copies of all Radack’s emails, which might have strengthened Lindh’s defense.  Radack, then with a private law firm, leaked her emails to Newsweek, which published them and her name.  For years afterward, the government made Radack’s life a hell of attacks, inconveniences, and legal expenses.

But ambiguities of Radack’s story are as striking as those of most whistleblower cases.  The government debated whether her emails constituted formal advice.  Whether an attorney engaged by Lindh’s parents, unbeknownst to him, was really his attorney.  Whether DoJ intentionally withheld emails from Lindh’s defense.  And whether Radack was really forced out of DoJ.  Government lawyers contended Radack violated attorney-client privilege by disclosing the emails to Newsweek.  They claimed actions against her were justified because she violated her professional ethics.

That the government challenges Radack’s depiction doesn’t make her rendition wrong.  That the government echoes most accused companies by saying Radack misunderstood situation and she misbehaved doesn’t make her telling right either.  We will never get to what is really true in the matter.

The government case against Lindh arguably fell apart.  In 2002 he received a 20-year sentence, not the multiple life sentences initially sought.  That some of the evidence against Lindh was obtained through torture may have been why.  Maybe Radack’s whistleblowing contributed.  Whatever the reason, Lindh retains his faith in global jihad and will be released next year.

It can be hard to see how our whistleblowing had any impact on the situation we wanted to change.  While I was CFO at HomeFirst Services, I suggested we do a better job of reporting results but I got nowhere.  HomeFirst continues that lack of transparency by not publishing its 2017 audit report[1], which shows a $1.4 million loss before noncash activities, until after its big winter contribution season ends.

While CFO I argued unsuccessfully for expense reductions to avoid financial problems.  But annual administrative costs were increased by $1.4 million, and HomeFirst’s June 2017 cash balance wouldn’t cover even one biweekly payroll.

While Compliance Officer, I reported eight legal violations and identified a dozen more.  None resulted in action against HomeFirst or in any meaningful change in its operations.  HomeFirst’s largest financial violation – overbilling HUD by $1.2 million – was mostly forgiven by HUD[2].  The company’s misuse of $138,000 of City of San Jose money was entirely forgiven.

Nothing was accomplished by my whistleblowing.  Nearly everyone else involved has moved on.  Now that the State has rejected my complaint, my footnote to the HomeFirst audit report will vanish.  The entire incident can be forgotten.

America was caught up in post-9/11 frenzy over terrorism, torture of suspected terrorists, and the Bush Administration’s lurch to war in Iraq.  Radack rode a pretty minor misdeed into whistleblower fame.  Her story has been told in Newsweek, The New Yorker, The New York Times, NPR, among many media outlets.   Three years after she was first attacked, she recovered professionally to join the D.C. Bar Legal Ethics Committee.  She went on to serve as director of National Security & Human Rights at Government Accountability Project, where she represented NSA whistleblower Thomas Drake.  She traveled to Moscow to meet with Edward Snowden.  She won awards.

Few whistleblowers win awards, see their stories told in The New Yorker, or mix with big-time whistleblowers.  But, like Radack, the results of their whistleblowing are slight.

This can be true even of big-time whistleblowers.  Daniel Ellsberg, the patriarch of whistleblowers, released the Pentagon Papers in 1971, hoping to stop the war in Vietnam.  Responding to widespread public pressure, the Nixon administration began to draw down troops years before the release, but the war continued for nearly four more years.  Like Radack, Ellsberg is justifiably a whistleblowing celebrity despite doubtful results.

We go through life uncertain of the meaning of our efforts.  We perform jobs, raise families, accumulate some assets, and form friendships.  The significance of any of our accomplishments is open to great doubt, our whistleblowing no less than anything else.

I appreciate the encouragement Radack, Ellsberg, Government Accountability Project, and others give to whistleblowers.  Having hope for a successful outcome can make it easier to undertake a dangerous project.  But I also think that the ability to launch a project we expect will fail can be a valuable life skill.

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[1] The report, issued on October 31, 2017 and available at Federal Audit Clearinghouse, was not available on HomeFirst’s website as of February 5, 2018.

[2] HomeFirst’s 2017 audit report stated that HUD had forgiven about $800,000 of the amount and the balance is payable in three installments beginning in 2018.

Whistleblowing When You Know You Will Fail

Whistleblowing When You Know You Will Fail

Whistleblower projects tend to go on for years, and you have to wonder why exactly.

First there is the observation of wrongdoing.  You bring it up to management.  They push back and start retaliating against you.  After you are fired, you get an attorney involved.  Maybe there are negotiations; they take a while.  Complaining to a State agency can take a couple of years[1].  A lawsuit is longer still, with discovery, motions, rulings, and so on.  Then there are the appeals. 

My run at HomeFirst, start to finish, lasted 4½ years for nothing.  Others keep going longer: Robert Purcell stayed at it for 18 years.  He also got nothing.

Our projects last so long, and so many people warn that they will end badly.  We must all sense we will lose.  When – how many times – do we realize that we are going to fail?  Why not stop when we see our bleak future?

I began to understand things would not work out well a month after I disclosed the first of HomeFirst’s violations, its overbilling of Santa Clara County by $140,000.  At a meeting of the board’s finance and executive committees the board chair warned, this year will be challenging and we don’t want any more red flags.  Everyone else kept quiet.  I protested, asking if she wanted me to conceal wrongdoing.  No, just let CEO Jenny to decide what to do, she said.  That’s what I told him, Jenny said.  Everyone else’s silence made clear whistleblowing would not be received warmly by the HomeFirst crowd.

I continued to find more problems, and the CEO and board continued to do little while claiming they did as much as they could.  It was clear they would never act, but I persisted.  Why in the world?

Eight months after I began, I admitted that I had made two disclosures externally.  I wanted to protect myself.  The board’s attorney told them I had taken Whistleblower 101.  He advised firing me and negotiating a settlement of around $100,000.  After reading their emails, I was enthused and continued my work.

Time crawled.  The CEO built a case for firing me for cause.  I watched potentially dangerous emails accumulate in her Mike Veuve folder.  I began to look for an attorney.

The guy I found, Stephen Jaffe, assured me I had a case.  Of course.  I was enthused again.  I paid him a $5,000 retainer against a 40% contingency.  After HomeFirst fired me, Jaffe moved slowly.  I doubted he would perform.  I paid another $3,000 for a mediator.  It would save a lot of time, he said.  It would save him expense, I heard.  It became clearer I would fail, but I had no options and proceeded.

Jaffe didn’t work out.  He settled for $45,000 and a nondisclosure so tight I couldn’t even bitch to my wife about HomeFirst without giving back the money, including Jaffe’s 40%.  Jaffe said it was a good deal, a success.  Even if it felt like a failure to me.  I rejected it.

Then I complained to the State.  No additional cost to me, so I did it.  I asked to be reinstated, but I didn’t really expect that.  A clerk told me it would take 6-8 months.  After a year of following up, I decided the State would not help either.  The first draft of its determination letter was in my favor, I was told.  Mild but also disbelieving enthusiasm.  A year later, the final version ruled against me.  My final failure.

For the entire 4½ years, I continued to follow-up on my complaints about HomeFirst even though it was pointless.  One by one I had to abandon them.  At each step HomeFirst won; I lost.  For years now I’ve known I would lose.  It was like I found schadenfreude in my own defeat.

What brings this to mind is Chelsea Manning, whistleblower.  Manning gained fame after she released secret government documents to Wikileaks.  Her leak was soon discovered.  She was arrested, convicted, and sentenced to 35-years in a maximum security prison.  President Obama commuted her sentence after 7 years of confinement.

Now she fashions herself as a politician running for a U.S. senate seat in Maryland.  Manning is 30 years old, has no meaningful experience, and is a felon for betraying U.S. secrets.  She probably should have known how her whistleblowing would end, but she went ahead anyway.  Now she is spending time and money running for office despite knowing how that will end.  In explanation, she says the establishment needs to be challenged.  The animus that helped her to whistleblowing glory still burns in her.

What else brings this to mind is Stephen Jaffe, my former whistleblower attorney.  Like Manning, Jaffe sees himself as a politician.  He is running against Democrat leader Nancy Pelosi for her seat in the House of Representatives.  He has raised $66,000 against Pelosi’s $1.9 million.  Jaffe and everyone else knows he will fail, but there he is campaigning.  Judgment, I am reminded, is not necessarily his strong suit.

Why people undertake doomed projects is always something of a mystery.  We like to come up with explanations eventually, though.  About whistleblowers, we say they are moral heroes, the law or their professional standards demanded they do it, they wanted a reward, they tried to hide the fact that they couldn’t do their jobs, they wanted to destroy the organization, or something else. 

Professor C. Frederick Alford and some whistleblowers contend they had no choice but to blow the whistle.  It was a choiceless choice.  They could not have lived with themselves if they had remained silent.

Most of the time it’s pretty clear that our whistleblowing will not be useful.  No moral standard demands our profitless self-sacrifice.  We just waste our time and money on the project. 

I suggest whistleblowers will be free only if we accept that our motives were, maybe in large part, base and we knew we would fail. 

We were not compelled by anything.  We intentionally chose to blow the whistle (or whistles) despite the probable outcome.  We did not deserve victory any more than someone else deserves wealth or good health.  We lived, and we acted.

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[1] 2.1 years on average pass from termination to determination, based on decisions by the California Department of Industrial Relations in 2014 and 2015 (using copies provided by State).  My unfavorable determination letter came nearly 3½ years after HomeFirst fired me.

Silence Breakers, #MeToo, and Whistleblowing

Silence Breakers, #MeToo, and Whistleblowing

Time’s Person of the Year 2017 is the Silence Breakers, women who have raised their voices against sexual misbehavior.  They may be whistleblowers, but not all in the traditional sense.  Unlike the rest of us, they have started a firestorm.

Whistleblowing has been defined in various ways.  One early (1985) version put it:

the disclosure by organization members (former or current) of illegal, immoral, or illegitimate practices under the control of their employers, to persons or organizations that may be able to effect action[1]

In some ways this reading covers a broad range of actors.  It includes, for example, those who, like me, reveal relatively minor misdeeds.  Some ethicists think only disclosures of big crimes are worthy.  Also, it does not limit the behavior we disclose to violations of law, which is demanded by most whistleblower protection laws. 

It is, though, restrictive in other respects.  It expects the whistleblower to be part of the offending organization, making loyalty a potent issue.  It demands that the wrong be actual rather than merely suspected, as most laws now allow.  Further, it requires the disclosure be made to someone who can fix the problem.  Just telling journalists doesn’t count.

The Silence Breakers – and #MeToo, Time’s Up, and other movement participants – call out possible wrongs, but not always those committed by organizations where they are members.  As a result, formal channels often don’t exist for registering their complaints, and those they approach may be unable to fix anything.

Every whistleblower’s charge is denied by her accused, but Silence Breakers are subject to especially wide-ranging denials and critiques.  Among the bad guys, Harvey Weinstein said his relations were consensual.  Donald Trump called his accusers liars.  Bill O’Reilly said there was nothing to the claims made against him even as Fox was paying $32 million in his newest settlement. 

Similar denials arise in corporate fraud cases, of course.  For example, Wells Fargo refused to admit government claims when it agreed to pay $50 million to the Consumer Financial Protection Bureau and $35 million to the U.S. Comptroller for fraudulently opening customer accounts.  And when it settled for $108 million claims it improperly charged fees on veterans’ mortgages.  Again when it agreed to pay $766 million for improperly foreclosing mortgages.  And when it agreed to change its practices and to pay $4 million for improperly repossessing the service members’ cars. 

We expect accused wrongdoers to deny our claims.  But kibitzers like to weigh in on what Silence Breakers report.  A hundred French female public figures believe that the matters demand a more nuanced understanding of sexual relations.  Matt Damon cautioned not to conflate casual sexual offense with sexual assault.  Then under pressure he walked his comment back.  A woman’s report of abuse by Aziz Ansari was followed by impassioned criticism and support.

Deciding if a behavior was really wrong is difficult in any whistleblower case.  For some the rankness of the act makes it more clearly wrong.  For others any offense is worth proclaiming.

Even more basic than the question whether behavior is right or wrong is: who cares[2]?  Whose interests are harmed may decisive.  I accused HomeFirst of several violations, but no one really cared.  The financial stakes could have been too small.  Or maybe the injured were just homeless folks and none was seriously hurt.

The interests harmed are not always those of the general public.  Many whistleblowers disclose misdeeds that affect them personally.  Their paychecks bounce.  They are denied paid breaks or overtime pay.  Or they are exposed to danger in the workplace.  Silence Breakers have disclosed actions that reach new levels of personal insult.  Rape and forced witness to someone masturbating are hugely more damaging than the typical crimes most people disclose.

Organizations regularly ignore our honest complaints and claim we were fired for good reason.  It was our faulty teamwork or performance.  Those accused by Silence Breakers likewise claim their victims were at fault.  The way they dressed or behaved was the problem.  They work in an industry where such things are common.  They should be ashamed of themselves.

Most whistleblowers disclose white-collar crime – there’s a lot of that occurring all the time.  How much sexual misconduct goes on can be a matter of definition.  The U.S. Department of Justice reported 432,000 cases of rape/sexual assault in 2015.  But broadening the definition, one poll found 54% of all women have experienced unwanted sexual advances in their pasts.  #MeToo’s power is less surprising than the fact that it took so long to emerge.

Organizational whistleblowing has been awash in public attention for more than four decades.  In 2002 it was three female whistleblowers who were Time Persons of the Year.  Disclosures have increased.  Laws have been passed to protect and even reward well-placed whistleblowers.  But just a few of us have risen to hero status.  And we have started no revolution.

Silence Breakers, #MeToo, and others uniting their voices against sexual harassment could truly rock relations in the workplace and in social life.  If they do, it will be a change that has been in process for decades.  Their success will follow years of personal pain experienced by millions.

Most regular whistleblowers lose in our projects.  I did.  It’s hard to make sense of what we did when so little changes[3].  We’d like some of the revolution the #MeToo crowd sparks.  We’d like some of that righteous fury again.

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[1] Miceli, M. P. and J. P. Near: 1985, 'Characteristics of Organizational Climate and Perceived Wrongdoing Associated with Whistle-Blowing Decisions', Personnel Psychology 38, 525-544 quoted in Mesmer-Magnus, Jessica R. and Chockalingam Viswesvaran. “Whistleblowing in Organizations: An Examination of Correlates of Whistleblowing Intentions, Actions, and Retaliation.” Journal of Business Ethics 62 (2005): 277–297.

[2] Asked by critics from the beginning.  For example Nader, Ralph, Peter J. Petkas, and Kate Blackwell (eds.)  Whistle Blowing: The Report of the Conference on Professional Responsibility. New York: Grossman Publishers. 1972; Bok, Sisella. “Whistleblowing and Professional Responsibility.” New York University Education Quarterly 11.4 (1980): 2-10; Bouville, Mathieu.  “Whistle-blowing and morality.”  Journal of Business Ethics.  81.3 (September 2008): 579-585; https://link.springer.com/article/10.1007/s10551-007-9529-7

[3] Edward Snowden admitted "the greatest fear that I have regarding the outcome for America of these disclosures is that nothing will change."

A New Whistleblowing – Kohn’s New Handbook

A New Whistleblowing – Kohn’s New Handbook

Stephen M. Kohn’s The New Whistleblower’s Handbook prescribes an ethics-free approach to whistleblowing.  He responds to a world much different from 35 years ago.  Ethics and morality, which were core to the older whistleblowing, are not inconsistent with his new approach.  They are just not that important.

Since whistleblowing became a phenomenon, the number of laws protecting whistleblowers has increased, and more are added each year.  There are now 55 federal laws, and most states have at least a couple.  Federal and local governments have ramped up payments to vendors, especially for health-related services[1], expanding opportunities for fraud. 

Kohn points to two other important factors that have changed the whistleblowing landscape.  First, anonymous reporting has become more common.  Anonymity is helpful because it can protect the whistleblower, at least for a while, from retaliation.  Second and Kohn’s favorite, reward laws allow disclosers a chance to share in fines and other recoveries from wrongdoers.

Early writers on whistleblowing focused on the ethical questions we should consider before making our disclosures.  That was proper, Sisella Bok[2] wrote, because we break our duty of loyalty to our employer and colleagues when we blow the whistle on them.  Despite our disloyalty, whistleblowing is morally permissible, Richard De George[3] wrote, if

1.       The firm will do serious harm to the public

2.       We first report to our immediate supervisor and

3.       If the supervisor fails to take effective action, we exhaust the internal reporting methods

Furthermore, whistleblowing is morally required if

4.       We have hard evidence that would convince a reasonable, impartial observer that our view of situation is correct

5.       We have good reason to believe that by going public the necessary changes will be made.  The chance of being successful is worth the risk taken by exposing the problem.

In contrast, Kohn’s thirty rules for good whistleblowing do not sound moral concerns.  They include

#3  Follow the Money (Use laws that pay rewards)

#4  Find the Best Federal Law (It will offer protection and rewards)

#6-12  Get Reward!

#15  Make Sure Disclosures Are Protected

#17  Beware of “Hotlines”

#18  Don’t Talk to Company Lawyers

#22  Delay Is Deadly

#23  Conduct Discovery

#26  Get Every Penny Deserved

#27  Make the Boss Pay Attorney Fees

Rule 30 states whistleblowing works.  As proof: from 1988 to 2016 the Department of Justice civil fraud division recovered $15.3 billion without the help of relators.  With their help, the DoJ recovered $37.7 billion.  The whistleblowers received $6.4 billion for their efforts.

But Kohn’s handbook describes a narrow patch of the whistleblower landscape.  During the past five years, the DoJ recovered an annual average of $3.3 billion on whistleblower complaints.  It also received just 693 new whistleblower suits a year.   That’s a miniscule portion of the million or more whistleblower complaints a year.

Kohn’s new world does not concern most whistleblowers.  It didn’t apply to me.  HomeFirst had no anonymous complaint reporting system.  Even if it had, my identity would have been discovered quickly enough.  Although the State did not reveal I had complained about its licensing violation, the CEO and Board chair figured that it was me. 

Most of the violations we disclose do not lend themselves to a calculation of rewards.  My whistleblower complaint listed eight HomeFirst violations.  None of them involved outright fraud.  The misdeeds were simply violations of laws and government agreements that did not provide rewards.  When government agencies waive the violation or fail to reclaim the ill-gotten funds, as Santa Clara County and HUD did with HomeFirst, there’s no hope for compensation.  But retaliation still occurs.

Even some famous whistleblowing falls outside Kohn’s territory.  No qui tam suit was available to Edward Snowden or Chelsea Manning.  And few of Politico’s top 10 whistleblowers could hope for rewards even under new laws. 

Kohn doesn’t discourage disclosures made for intrinsic or ethical reasons.  He just directs us to a more practical and self-aware way of whistleblowing.  When C. Frederick Alford[4] reported his interviews of whistleblowers, he warned us that we will probably not improve anything by our efforts.  Our suffering will probably be meaningless.  Rather than acting heroically, we are more often driven by moral narcissism[5].  Kohn offers an attorney’s counsel out of that despair.

But Kohn’s result may not inspire the general public.  Popular imagination is not excited by whistleblowers who are in it only for their own payoff.  Folks are fascinated by someone like Edward Snowden who acts to protect rights for all of us.  We are intrigued, if puzzled, by a person like Eric Ben-Artzi who won then turned down an $8.5 million award because he thought the wrong people were punished.  Kohn speaks to the potentially winning whistleblower, not to those who stand on principle or who chose to remain silent.

Early writers tested whistleblowing against a moral standard because they thought the act was inherently immoral.  A stain on our loyalty.  Employment-at-will laws and short tenures have reduced the expectation of loyalty, but still external measures of whistleblower sincerity seem necessary.  The idea of the public good is one test in laws.  Or, as Kohn recommends, a successful lawsuit based on solid evidence and an adroitly selected law.

Alternatively, we could admit that the violation we disclose is simply one wave on top of a choppy sea of misbehavior.  Like most, I blew the whistle because I was dissatisfied.  It’s perfectly reasonable to be unhappy with an employer that does lots of bad things.  It’s altogether appropriate to strike at that employer.

Employers like to dismiss whistleblowers as disgruntled employees.  The State determination letter in my case accepted that.  My relations with HomeFirst’s CEO and Board deteriorated, and they deserved to fire me, the State said.  But we are disgruntled.  That’s why we blow the whistle.

We can retrospectively justify our action in terms of external moral standards.  We can evaluate the action in terms of how effective it changed another’s behavior or secured a reward from some authority.  Still our action comes from within us.  It is ours, successful or not.

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[1]Medicare/Medicaid fraud is a favorite target for False Claims Act suits.  Medicare/Medicaid costs increased from $61 billion in 1980 to $1.2 trillion in 2016.

[2] Bok, Sisella. “Whistleblowing and Professional Responsibility.” New York University Education Quarterly 11.4 (1980): 2-10

[3] De George, Richard T.  Business Ethics.  6^th edition.  Upper Saddle River, NJ: Pearson Education.  2006.  De George first published his text in 1982.

[4] Alford, C. Fred. Whistleblowers: Broken Lives and Organizational Power. Ithaca, NY: Cornell University. 2001

[5] Ibid 79

When We Lose (Part 4) – Being Alone

When We Lose (Part 4) – Being Alone

Whistleblowers are individuals who confront wrongdoers.  They stand up against the system.  That’s the myth.  It is true that most of us act singly when we disclose misdeeds.  But I did not feel exactly alone on my project.  Not until the end anyway.

Citigroup promoted Richard Bowen to senior vice president in 2006.  He soon discovered that 60% of the $90 billion of the mortgages his area bought and sold to Fannie Mae and Freddie Mac failed the bank’s credit tests.  He alerted Citigroup management to the problem because it was part of his job.  He didn’t oppose the organization.  He acted as a vital member of the institution.  When management didn’t respond, he approached the Citigroup board of directors.  They, too, didn’t act, and he went to the Securities and Exchange Commission.  Then he testified before Congress.

At each step Bowen believed that he was doing his job.  Each time he expected to be welcomed in the deepening circles of authority.  As it turned out, he did not belong.  Officials at each level failed him.  In 2009 he was fired.  His severance was less than $1 million – a small amount compared to his salary and his lawyer’s take – and Citigroup later received a $45 billion bailout plus $300 billion in asset guarantees from the government.

Whistleblowers’ stories are not always about ethical norms.  They don’t necessarily reflect the defense of good against evil although they may later be cast that way.  Lots of times they are about being part of a work unit, a management group, or some other community.  Until you find your friends have no use for you.  First comes the ostracism.  Then the reprimands.  Then justification for retaliation makes it perfectly clear: you were not on the team after all.

When I revealed HomeFirst’s overbilling of Santa Clara County, I was just doing my job.  When I objected to the board chair’s admonition not to disclose any more violations, I assumed the other board members present would help because they valued me.  Privately afterward, the board audit chair encouraged me, and I thought I was embraced and safe. 

But the board continued to support the CEO despite more identified violations.  Its willingness to believe that I was the unfit one, not she, made evident that I had no entry into their circle.  But I still believed that government monitors would respect and welcome me.  One by one, they too let me know that HomeFirst was their partner and I was not.  The Department of Justice attorney stated it most plainly: they did not like going after organizations they thought did good.  The other agencies spoke through inaction.

A 2013 survey by the Ethics & Compliance Initiative found that 92% of those who report wrongdoing do so first internally.  Bowen did that; I did, too.  We believed that others in our company needed to know.  We were not loners standing up courageously.  We were not speaking truth to a foreign power.  We communicated with our colleagues, we thought.

Most of us successfully spend years in organizations like the one that rejects us.  Bowen rose to senior vice president at Citigroup because he served his employers well.  I was CFO of five companies and did some good work, even at HomeFirst.  Whistleblowing is hard because we need the organizations that eventually toss us out.

The expulsions can leave us isolated.  James Holzrichter called out overbillings by defense contractor Northrup Grumman.  The company fired him.  It blackballed him, blocking him from another auditing job.  He and his family were homeless for a time.

Attorney Jesselyn Radack thought she was doing her job when she advised the Department of Justice that accused terrorist John Walker Lindh needed to have his attorney present during interrogations.  She was pressed to resign.  After the DoJ publicly denied receiving her counsel, she leaked information to Newsweek.  The agency responded by getting her new employer to fire her and state bars to investigate her.  That made getting another legal job nearly impossible.

Through a combination of factors, including their personal skills and the significance of their claims, some whistleblowers become well known for what they did.  Bowen is one of many inspirational speakers on whistleblowing.  Holztrichter also speaks, consults, and encourages whistleblowers.  Radack works for the Government Accountability Project in defense of big league whistleblowers.

Like many in the little leagues, I believed the whistleblower myth.  I expected the protection promised by long-term loyalty and the law.  But the state determined that I was not a whistleblower at all.  I did not belong in that circle either.  I was alone.

When We Lose (Part 3) ­– Perfect vs. Good-Enough

When We Lose (Part 3) ­– Perfect vs. Good-Enough

A friend worked in high tech until an acquisition helped him bail out.  Now he toils in metaphysics.  Struggling to define what we really know, he has settled on references.  Rather than knowing the cup before us, he figures, we perceive features that have meaning only in reference to past perceptions.  Our window of current experience keeps moving with new perceptions, so the references keep changing.  As a result, perfect knowledge is unstable if not impossible.

Periodically I encourage him to go easy and accept good-enough.  The cup now is similar enough to the cup an hour ago.  They really are the same cup.  Have some faith, I urge him.

Not so much a battle between the forces of good and evil, whistleblowing is a contest between perfect and good-enough.

Wrongdoers are forever claiming that their behavior is good-enough.  Approaching his trial, Jeffrey Skilling, one of the worst, asserted in his innocence as CEO of by-then-defunct Enron.  But he was convicted anyway.

Davita, Inc. is another interesting example.  In 2014 Davita agreed to pay $389 million to settle kickback allegations without admitting guilt.  In 2015 it agreed to pay $495 million to settle claims it only partially dispensed medications charged to the government.  Again it admitted no guilt.  Now in 2017, it agreed to pay $64 million to end another whistleblower suit.  Without admitting to doing wrong it bragged, “We take full ownership and continue to embrace transparency and rigorous compliance.”

When I revealed HomeFirst broke a California licensing law, CEO Niklaus defended the behavior.  Strict enforcement could close shelters across the State and put more homeless on the streets, she said.  The State inspectors agreed to delay action against the company so that it could come up with a fix.  HomeFirst was, in its eyes, good-enough.

Whistleblowers look harshly on deviations from perfect.  This can lead to complaints companies insist do not tarnish their good-enough status.

When HomeFirst cut the number of beds in its youth shelter from 10 to 8 in violation of a California loan requirement, Niklaus didn’t think it was a big deal.  I blew a whistle on that.  I also blew a whistle when kitchen workers lacked the required State-issued food safety cards.  The cards could be earned after passing a quick test and paying the $10 fee.  Probably not a huge infraction, really.

I join others who disclose misdeeds that some might think ridiculous.  Joel Allen complained the Philadelphia police didn’t exercise its horses enough.  Two Valley Mills (TX) employees accused the city manager of taking their deer feeders.  Autopsy manager Kevin Gerity said his boss mishandled a bullet fragment.  A Florida police officer attending his son’s Little League game while on duty was something Travis Harper could not accept.  Each was punished.

Our complaints may seem petty to some, but not to us.  The violations often fit patterns of misconduct.  My food safety complaint, on the day I was fired, came after complaints about nine other HomeFirst matters.

Minor complaints could involve simple misunderstandings.  You wonder why we don’t just sit down and talk them over.  Then the table turns.  The organization dumps its stored complaints against the employee to justify disciplinary action.  They, too, can be petty.

An Iowa state agency said whistleblower Susan Ackerman put incorrect information on an insurance application.  The City of Charlotte didn’t like Crystal Eschert’s Facebook post.  Petersburg (VA) Derrick Greer police officer ate a piece of candy he picked off the floor at a crime scene.  Patrick Leonard cursed while working for the City of Bayonne (NJ).  Troy Thompson ate a past-expiration sandwich from the VA kitchen instead of throwing it out. 

Sometimes both sides exchange petty complaints.  Juana Walsh worked at a senior living center in Woodstock (IL).  During one shift a male patient seemed confused.  He told Walsh he was afraid of a nursing assistant in the facility.  The assistant had told the patient to stop bothering him.  Then he was rough putting the man’s head on a pillow.  Walsh wrote up the incident and gave her report to the patient’s brother.  Her boss was upset when she learned about Walsh’s communication.  She fired Walsh for sharing patient information and stealing pencil and paper for her report.

Organizations and individuals are always violating something or another.  They are good-enough until they no longer are.  Rather than reasoned, the distinction is, often as not, emotional.  Morality and ethics have little to do with it.

The whistleblower’s legal case is based on a perceived violation that is properly disclosed.  Whistleblower protection laws demand attention to those specifics and don’t care about the employer's pervasive bad behavior.  Once the disclosure is established, the employer seeks to show she was not good-enough, regardless of her disclosures.  Its petty complaints help that proof.  Then other reasons follow: the usual insubordination, poor performance, and didn’t-get-along charges.

We trust authorities – California’s Labor Commissioner, for me – to sift facts from false claims and get to the real truth.  Their lack of expertise in all laws related to all complaints forces them to be satisfied with a good-enough understanding.  We walk into our whistleblowing hoping for perfection, but we leave dissatisfied.

Big-time players expose extraordinary issues that point to the core problem: the wrongdoer is just no good.  The rest of us are bound to narrow rules and seldom break free.  The organization is judged good-enough, and we are not.