Journalist Tom Mueller’s most recent book, Crisis of Conscience, Whistleblowing In An Age of Fraud, was the focus of a recent McCuistion TV program on KERA, PBS Dallas.
Dr. Mueller and Marianne Jennings, JD, Professor Emeritus, Arizona State University and author of The Seven Signs of Ethical Collapse, joined hosts Jim Falk and Dennis McCuistion to talk about how whistleblowing is a key component to exposing and counterattacking fraud, what circumstances compel a whistleblower to act and the impact whistleblowing has on bringing fraudulent companies to account.
Tom Devine, Legal Director of the Government Accountability Project, says of Crisis of Conscience, “Mr. Mueller’s book is the definitive treatment of whistleblowing… (he) not only describes the ordeals and impact of those who change the course of history, but takes us on a journey through their souls.”
In the program itself, the guests discuss that whistleblowers have often depleted every source of taking action, and of bringing the fraud to the attention of their superiors, to no avail and finally feel compelled to blow the whistle, risking their livelihood and being called snitch and traitor.
In his book, Mr. Mueller asks the 200 plus whistleblowers he interviews, “Would you do it again?” I briefly joined the TV program, to talk about my experience and give a resounding yes to that question. As others have said, “you have to sleep at night, and it was the right thing to do regardless of the ensuing dire consequences.”
Both Ms. Jennings and Mr. Mueller remind us that whistleblowing is not new to the United States. They take us back to 1777, when Marine Captain John Grannis discovered and reported crimes committed by Esek Hopkins, Commander in Chief of the Continental Navy, who was treating British prisoners “in the most inhuman and barbarous manner.” Not only did Congress release Hopkins of his command, in 1778 they issued an act that claimed, “it is the duty of all persons in the service of the United States, as well as other inhabitants thereof, to give the earliest information to Congress or other proper authority of any misconduct, fraud or misdemeanors committed by any officer or persons in the service of these United States, which may come to their knowledge.”
It is no coincidence that both the law and the First Amendment serve as a model for government and incorporate a citizen’s duty to denounce wrongdoing. Ms. Jennings and Mr. Mueller remind us that whistleblowers are the models we must emulate if our society is to survive.
In spite of what we know is the right thing to do when we suspect fraud, too many of us remain compliant. After all our jobs are dependent on the way the company is doing business. Employees feel as if they are doing their jobs and a slippery slope creeps into the organizational culture. After all you are compensated and rewarded on the activities being conducted and wrong decisions, fraudulent ones spiral out of control, until there’s a headline.
Unfortunately, fraud is alive and flourishing. The DataVisor Fraud Index Report for 2018 reports a dramatic growth in fraud infrastructure. North America seems to be a leading source of financial crime, and the PWC’s 2018 Global Economic Crime and Fraud Survey suggests that 51 percent of corporate organizations are blissfully ignorant and ignoring their obvious fraud problem.
The incidence of economic crime committed by internal actors has increased to 52 percent. Interestingly, the proportion of economic crimes committed by senior management increased from 16 percent in 2016 to 24 percent in 2018.
Something is very wrong with this picture. As Crisis of Conscience reminds us and is reiterated on this program, whistleblowers force us to confront fundamental questions between individual morality and corporate power. Yet it would be so much more effective if organizations did not stay, accidentally or deliberately, “blissfully ignorant of their fraud problem.”
It’s a new year. Perhaps this is the year that this trend can be reversed, and proactive steps can be taken to identify fraud and eradicate it with better rules, transparency and all the steps a company can take to provide better leadership and a transparent ethical company. Is that wishful thinking?