... Whistleblowing and Sarbanes-Oxley Due If something happens in the organization, for example, a worker is thought to be engaged in illegal activities, then a whistleblower reports on this to the legal institution. As a rule, a whistleblower is an employee, so to encourage him/her to disclose the information and to assure that one is making a right step the Whistleblower Protection Act was adopted (Ethics and corporate social responsibility, 2009). The things whistleblowers do are very serious. One should always remember that such actions may lead to the loss of money and reputation by the company or particular workers. Not everybody is ready to accept these; that is why the whistleblower might be threatened and compelled to leave the working place. The employees have different views on who the whistleblowers are. Some believe them to be disloyal workers, who are ready to betray the organization at any moment; others treat them as a helping hand in the eliciting of truth and putting things right in the company. Corporate governance and whistleblowing are working side by side. Sometimes a malpractice by an employee cannot be reported in an ordinary way. Typically this happens when a problem is related to the person who usually assists the whistleblower or to whom he or she reports to (Ethics and corporate social responsibility, 2009). If the culture of ethical conduct is present in the organization, then it is likely to give encouragement...
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...Ethics and Corporate Responsibility in the Workplace and the World Contrenia L. Fluker Professor Steven D. Bond Law, Ethics and Corporate Governance (LEG 500) May 19, 2014 Determine all the stakeholders in this scenario. A stakeholder is defined as a person, group or organization that has interest or concern in an organization according to BusinessDictionary.com. The stakeholders in this particular scenario are PharmaCARE, a successful pharmaceutical company, CompCARE, a subsidiary of PharmaCARE, Wellco, a large drugstore chain, the employees of the various companies, the African nation of Colberia and its people, the medical community and the consumers of the products. Analyze the ethics of PharmaCARE’s treatment of the Colberia’s indigenous population and its rank-and-file workers versus that of its executives. Rank-and-file employees are the lifeblood of organizational success. Without rank-and-file employees, many companies' production levels would dwindle to nothing because rank-and-file employees often are solely responsible for turning out the products that companies sell (www. smallbusiness.chron.com). This is what the Colberian people brought to PharmaCARE. The “healers” were willing to share information about indigenous cures and an abundance of Colberian willing to work for $1.00 a day by harvesting plants walking five miles in and out of the jungle carrying baskets that weigh...
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...blowing has been almost nonexistent during the run up to the financial crisis and its aftermath. This is reflective of the negative stigma that is associated with whistle blowing in most businesses and corporations. Combined with a culture of silence that is prevalent in the finance and accounting industries this is not a big surprise. Federal regulators and congress have been encouraging whistleblowers to step up in recent years, however more must be done. Regulators must continue to improve protection and incentives for whistleblowers to come forward. In addition corporate culture must change in its negative view of whistle blowing. Most importantly though professionals, especially accountants must understand that they are serving the public interest and thus must step up and reveal any fraudulent or unethical activities that hurt the public. Whistle blowing is hard to encourage and federal authorities have been doing terrible job of it until recently. The trend has been changing, first with the passing of the Sarbanes-Oxley Act in 2002 that included a provision for expanded whistle blower protection. The act made it legal for public companies to fire employees that reported any illegal activities in which a firm or its employees...
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...Assignment 1: Whistleblowing and Sarbanes-Oxley Act Michelle M. Webb Dr. Boneita Campbell LEG500 Law, Ethics, and Corporate Governance April 20, 2015 . Week 3 Assignment 1: Whistleblowing and Sarbanes-Oxley Act Who are Whistleblowers and what do they do? Could you be a Whistleblower? There are several definitions for the term whistleblower. The most accurate and significant definitions to the subject of this paper are the definition given by the Black’s Law Dictionary and the one by the Whistleblower Protection Act (WPA). The Black’s Law Dictionary defines a whistleblower as a worker who declines to participate in and informs on the unlawful and/or unjust actions of his co-workers or his employer ("The Law Dictionary", n.d.). The WPA defines whistleblowing as the disclosure of facts an employee deems proof of unlawful acts of, blatant misconduct, exploitation of authority, and could jeopardize public safety (Molzen, 2002). Over the years many U.S. workers have observed unlawful transgressions within the workplace and have come forward to report these actions. The actions of these noble citizens (whistleblowers) have been instrumental in saving enormous amounts of money and countless lives over the years. However, these whistleblowers fail to receive the recognition and admirations they deserve for doing the right thing. More often than not they are badgered, bullied, demoted, and terminated from their jobs for their efforts. Therefore, the act of whistleblowing...
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...(SOX) to primarily protect whistleblowers from retaliation for reporting corporate fraud and financial malfeasance to the government. The negligence became apparent in the 1990’s when corporations such as Enron, HealthSouth, Tyco and WorldCom were found to have grossly overstated their earnings. This cost billions of dollars in losses to shareholders and caused the near-collapse of the stock market (Prentice, 2010, p. 17). The companies were able to hide, scam or misrepresent their earnings due to the dot-com boom, soaring investments, and auditor fraud. The Sarbanes-Oxley Act contains many sections, sub-sections and creation of other agencies to enforce it. It was a sweeping change to standard reporting practices and was created to restore investor confidence, hold corporations and auditors financially and criminally accountable, and protect whistleblowers. Prior to the creation of SOX the whistleblower had no protection from retaliation by the organization. Whistleblowers had fears of criminal prosecution, bodily harm and job loss if they reported the misdeeds of their employer both publicly and privately. The Sarbanes-Oxley Act of 2002 redefined the whistleblower. An examination of the characteristics of a whistleblower, the Global Capital Markets Advisors whistleblower case, and whistleblower protection guaranteed by the Sarbanes-Oxley Act will demonstrate the benefits, setbacks, and drawbacks of SOX and whistleblowers. Characteristics of a Whistleblower There have been many...
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...private employees. The situation can be seen in several countries, there are a lot of unethical behaviors from employer or employees. There must be a reason unethical behavior happened. So, whistle-blowing protection was introduced in order to prevent any unethically behaviors in organization such as fraud, corruption, abuse of power and so on. Whistle-blowing has been defined as ‘disclosure by a current of former organization member of illegal, inefficient, or unethical practices in a organization to a person or parties who have the power or resources to take action ( Near and Meceli, 1985). It continues to receive media intention (Vinten, 1997). Whistle blowing is a deliberate non-obligatory act of disclosure, which gets onto public record and is made by a person who has or had privileged access to data or information of an organization, about non-trivial illegality or other wrongdoing whether actual, suspected or anticipated which implicates and is under the control of that organization, to an external entity having potential to rectify the wrong doing. Whistleblowing is presented as dissent, in response to an ethical dilemma, in the form of a public accusation against an organization. It contains six elements. These are: the act of disclosing damaging news; the whistleblower agent; a disclosure subject – some (potential) wrongdoing; a target organization held responsible; a disclosure recipient; and an outcome –the disclosure enters the public domain (Peter B....
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...There are some barriers to ‘whistle blowing’ such as fear of retaliation, duty of loyalty and confidentiality to the employers, cultural barriers, fear of alienation by peers and lack trust in protection. The Organisation for Economic Cooperation and Development (OECD) 2003 have recommended complaint handling methods such as develop complaint mechanism to deal with allegations of non-compliance, provide clear rules and procedures for whistle blowing, take steps to ensure those who report the violations in compliance with stated rules are protected against reprisal and ensure that the complaint mechanism themselves are not be abused. Besides that, Multinational Enterprises should refrain from disciplinary or discrimination action against the employees who make the bona fide reports to management or to the competent public authorities on practices that contravene the law. The Whistleblower Protection Act 2010 (WPA) which came into force on 15 December 2010 should be used to encourage employee to blow the whistle. This act is intended to provide all-encompassing protection to the private and public sectors. It is free-standing laws that is not only enacted as anti-corruption law, but also apply to violations of law, good practices and ethics. Obviously this act protects the whistleblower and by this, barriers to whistle blowing can be reduced....
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...Sarbanes-Oxley This document will describe the key characteristics of a whistleblower and briefly summarize on researched instance of Whistleblowing in one publically traded company within the last 12 months. It will include the details of the issue that the whistleblower reported and the effect of the whistleblower’s actions on both herself and the company. Next, it will evaluate whether or not the whistleblower was justified in reporting the company’s actions. Lastly, it will examine the extent to which the whistleblower would be protected under the Sarbanes-Oxley Act. Characteristics For many years, individuals have raised concerns about misconduct, unethical or illegal practices observed at their place of employment to reporters/media, employers’ ethics hotline, management, via labor law posters, or the Office of the Whistleblower. This included employees from private companies, non-profit organizations, and governmental agencies. Employees can report unethical actions regarding public safety, health, business practices, fraud, waste, and abuse. Keep in mind that is does not have to be an employee; it can also be a supplier, contractor, client or any individual who somehow becomes aware of the illegal activities. Despite the fact that unethical behavior occurs within the workplace, there are still several employees that are loyal to the law, the community and society as a whole. These people are known as whistleblowers. Publicly Traded Company One case in particular that was settled...
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...court. The law also limits damages to up to four years of lost wages, including the value of benefits, with interest. It prohibits discharge for other than good cause. Identify the parts of this law that appear to benefit employers. The state laws protecting whistleblowers vary enormously, but none of them protect whistleblowers who turn to the media first. Discuss why you think this is so. Explain why it either encourages or discourages ethical behavior. The purpose of the SOX whistleblower protections is to remedy the wrongdoings of corporations. The media doesn’t help the company.I believe that an employee should try to deal with the problem internally before going to the media. You want people to turn to media after they have done everything they could. I think that not protecting whistleblowers that turn to media first discourages people that have the wrong intentions. A person who goes public with the claims usually after failing to remedy the matters from the inside, at great personal risks to themselves. The person making the said allegations is termed as the whistleblower. Whistleblowers cannot remain silent and usually speak out on the face of improper behavior. A person is termed as a whistleblower only when he/she discloses serious...
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...of this article is to increase awareness of the need for whistleblower policies for universities, governmental entities, and organizations. According to wikipedia, the free online encyclopedia, a whistleblower is a person who raises a concern about a wrongdoing occurring in an organization or body of people, usually this person would be from that same organization. Wikipedia states that whistle blowing is the disclosure to the public or to authorities, usually by an employee, of wrongdoing in a company or government department. Whistleblowing inside the workplace is the reporting, by employees or ex-employees, of wrongdoing such as fraud, malpractice, mismanagement, breach of health and safety law or any other illegal or unethical act, either on the part of management or by fellow employees, cited from wikipedia. A whistleblowing policy encourages staff to speak out if they have legitimate concerns about wrongdoings, as distinct from individual grievances, and establishes an accessible procedure for doing so. The policy may form part of a wider code of conduct. In order to encourage disclosure, many federal and state statutes prohibit employers from retaliating against an employee who files reports. The revealed misconduct may be classified in many ways; for example, a violation of a law, rule, regulation and/or a direct threat to public interest, such as fraud, health/safety violations, and corruption. Whistleblowers may make their allegations internally (for example, to other...
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...economic philosophy of laissez-faire provided theoretical support for employment-at-will. Its legal underpinnings consisted mainly of “freedom of contract,” the idea that individuals are free to choose how to dispose of what they own, including their labor, as they see fit, and that the voluntary contractual promises they make are legitimately enforceable. (Halbert & Ingulli, 2015) federal civil rights laws created remedies against employers who fire workers because of their race, national origin, color, religion, sex, age, or disability.4 In the 1970s and 1980s, federal and state statutes included protection from retaliation for employees who report violations of environmental or workplace safety laws, for example. (Halbert & Ingulli, 2015) Whistleblower Protection Enhancement Act (WPEA), passed in a rare bipartisan way in 2012. The WPEA strengthens the 1989 Whistleblower Protection Act (WPA), covering federal employees who report waste, fraud, and abuse, but which had been interpreted narrowly over the years by judges who were clearly hostile to it. (Halbert & Ingulli, 2015) The Equal Employee Opportunity Commission...
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...Loss Prevention 2/10/2013 If a corporate IT director has been asked by their boss to program software so revenue will appear higher than it really should you have several options? Basically you have three main paths to choose. You could do what you have been asked to do and program the software. You could simply tell the executive that you are not comfortable doing it and just leave it alone. Or you could not do what you have been asked to do and report it to human resources and or the proper authorities. If you should choose to do what you have been asked to do then you should at least be aware of what you are doing. If you go ahead and do it you are breaking the law. This could even be considered fraud. If you choose to do this you could be held liable. The SEC notes that IT directors are responsible for the accuracy and integrity of the documents and data generated by a company computer system. In additional they should know if any unauthorized changes have been made in general ledger, accounts receivable and other accounting software (Purpura 2008). This information shows you that the executive knows exactly what they are doing. If you choose to move forward with what they have asked of you, then this means that any investigation is going to come straight to you as you are responsible for ensuring that this information is accurate. It would be very hard for you to argue that you were instructed to do so by an executive. If you choose...
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...When the Enron scandal took place in November 2001 several hundred million dollars had been overstated in Enron’s annual earnings. This caused for people to run out and get Enron stock which was thought to be highly profitable. When the S.E.C ordered an investigation against the multi-billion dollar energy company and found that Enron was falsifying documents and not honestly reporting it’s annually earnings, the company quickly went bottom-side up and took everything away from its employees and investors. Amidst the Enron scandal and several scandals with the same likeability, in order to limit the control of several business practices the federal, local and state government agencies has incorporated a way to regulate the control these businesses has over the public. Introduced to congress by Senator Paul Sarbanes and representative Michael Oxley in 2002 the Sarbanes-Oxley Act was passed, which is a set of laws that every organization whether it be big or small must abide by. With the incorporation of the SOX Act shareholders and the general public are protected from accounting errors, and fraudulent practices within an enterprise. It also is meant to improve the accuracy of corporate financial disclosures. The Sarbanes Oxley is arranged in eleven titles with the most important ones often being considered to be 302, 401, 404, 409, 802, and 906. Section 302 pertains to the ‘Corporate Responsibilities for Financial Reports.’ This article is to basically insure that the signing...
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...SUBMITTED TO Omar Faruk Assistant Professor Department of Business Administration East West University SUBMITTED BY Students of the Department of Business Administration ID No. Md. Mohiman 2009-1-10-147 Jaheda Sultana 2009-1-10-029 Md. Anamul Haque 2009-2-10-108 Md.Mehedi Hasan 2009-1-10-073 Organizational behavior Course Code: MGT251 Section: 3 East West University 1. Do you believe that whistle-blowing is good for organizations and its members, or is it, as David Stetler believes, often a means to extort financial gains from companies? Whistle blowing means calling attention to wrongdoing that is occurring within an organization. The fact whistle blowers are good/bad for an organization depends on different situations whether a whistle-blowing will have a positive or negative result over the organization. That is it depends on what they're whistling about. If it has intention to get someone trouble then we have to think about the undesirable consequences it might happen for whistle blowing. On the other sense, if it is someone who is angry with the organization for other reasons and blows the whistle solely to cause harm or embarrassment to the company, then they're just a jerk. On the other hand, of it is related to protest against unethical deeds then it is ok. If whistle blowing is a means toward a positive end, then in the long run, we might want to consider it good for the organization as a whole, but...
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...TERM PAPER: Fraud Prevention: Are Existing Deterrents Working Kevin B. Hoover ACC 630 – Professor Sheila Vagle University of Maryland University College Introduction I recently read the following quote posted by an anonymous person on Facebook: “I had ADHD when I was a kid too, but when I saw my father taking off his belt, I was healed”. I share that not just because it is true in my case, but because it is a fairly humorous and spot on example of a deterrent. Deterrence is a critical element of the effort to prevent a particular behavior. People have to have a reason not to act that way. When I was a kid, I didn’t know what a deterrent was, but I sure knew that the possibility of a whipping was reason enough not to lose my mind. What deters people working in the business and financial worlds from committing fraud? The Sarbanes-Oxley Act of 2002 perhaps? Fear of prosecution? One would hope so, but it is certain that the answer is more complex than that. In fact, it could be argued that the answer is nothing deters people from committing fraud because fraud is still happening. Therein, lies the aim of this paper. This paper will take a look at financial fraud and the deterrents in place since 2002, and offer the opinion that the deterrents are not working. A history of the issues as they relate to this opinion will be given. Further, recommended solutions to the perceived problems will be put forth. It is worthy of mention that deterrence and prevention...
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