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Osterhaus, Anja Fagan, Craig
Osterhaus, Anja
Fagan, Craig
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Abstract
While some whistleblowers are lauded for protecting the public good and detecting unethical or criminal behaviour, the overwhelming majority of known cases do not receive any recognition or compensation. On the contrary, they may face victimisation or dismissal from the workplace; their employer may sue (or threaten to sue) them for breach of confidentiality or libel, and they may be subject to criminal sanctions. In extreme cases, they face physical danger. Whistleblowers are often confronted with an attempt to cover up the facts of the case, or their warnings are simply dismissed or ignored. For example, in the case of the US-based fraudulent hedge fund run by Bernard Madoff, no action was taken despite the fact that financial analyst Harry Markopoulos had repeatedly raised concerns. Madoff’s fake scheme eventually cost thousands of investors billions of dollars. The official investigation of the case found that between June 1992 and December 2008, when Madoff confessed, the United States Securities and Exchange Commission received six substantive complaints that raised significant red flags concerning Madoffs hedge fund operations. All complaints were dismissed. The report concludes that “the SEC never properly examined or investigated Madoff's trading and never took the necessary, but basic, steps to determine if Madoff was operating a Ponzi scheme. Had these efforts been made with appropriate follow-up at any time beginning in June of 1992 until December 2008, the SEC could have uncovered the Ponzi scheme well before Madoff confessed.
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Book
Date
2009
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9783935711449
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With permission of the license/copyright holder