What Can We Learn from Existing Whistleblowing Legislation and Research?
Edited by David B. Lewis
Chapter 4: US Whistleblowing: A Decade of Progress?
Professor Terry Morehead Dworkin INTRODUCTION The past decade has seen a growth in the United States in both legislators’ attempts to enlist whistleblowers in controlling organizational wrongdoing and, to that end, to encourage observers of wrongdoing to come forward and report it. Public awareness of whistleblowing has also become widespread, although there are many misperceptions about it. One of the most important of these is that there are laws that effectively protect them if they report.1 As will be seen below, this is often untrue. Since every state now has at least one whistleblowing law (and most have several), and these laws differ, as do the numerous federal laws, only a broad overview is possible here. This chapter will explore the major recent developments in US whistleblowing law, why the laws are so often ineffective in achieving their goals, and suggest some changes that should help make them more effective. It will focus on three significant developments: dealing with financial fraud, rewards as a spur to whistleblowing, and protection for public employee whistleblowers. WHISTLEBLOWING AND FINANCIAL FRAUD Sarbanes-Oxley The Sarbanes-Oxley Act of 2002 (SOX) represents a reification by the United States Congress of the importance of whistleblowing in the control, detection, and deterrence of wrongdoing. It follows the dramatic growth of state and federal whistleblowing laws in the 1980s and 1990s, along with a growing hostility and distrust of big business and government. However, it was the wrongdoing, scandals and resultant publicity and anger brought on by the leaders of...
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