WBEZ | whistle-blowing http://www.wbez.org/tags/whistle-blowing Latest from WBEZ Chicago Public Radio en Whistle-blowing: Guilt or greed? http://www.wbez.org/blogs/bez/2012-09/whistle-blowing-guilt-or-greed-102374 <p><p>At the Securities and Exchange Commission, tips on financial misconduct and investment fraud have been pouring in at the rate of eight per day.&nbsp;According to the <em>Chicago Tribune</em>, as of mid-August the SEC&#39;s office on whistle-blowing had&nbsp;received in excess of 2,870 tips.&nbsp;</p><p><img alt="" class="image-original_image" src="http://llnw.wbez.org/styles/original_image/llo/insert-images/Money.jpg" style="height: 300px; width: 300px; float: left; " title="SEC payouts to whistle-blowers may be behind rise in tips (Flickr/ 401(K) 2012)" />Why this sudden rash of tipsters? Are the big-time players working deep inside our financial institutions suddenly burdened with a conscience? I don&rsquo;t think so. Two factors are fueling this rush to disclosure: fear of exposure and financial reward.</p><p>The list of individual players and big companies making the front page for the wrong reasons has been embarrassingly long: Bernie Madoff, Bear Stearns, AIG, Barclays. . . Frankly the heat is on.&nbsp;According to a Harris poll, 67 percent of the public distrusts Wall Street. I may be cynical, but I think a lot of insiders are telling all because they don&rsquo;t want to be blamed for <em>not</em> telling what they know. Jordon Thomas, a lawyer who represents whistle-blowers has said, &ldquo;[My clients] like their life, but they know something that they can&rsquo;t pretend they don&rsquo;t know [anymore].&rdquo;</p><p>In 2010 Congress passed the Dodd-Frank Act, authorizing a program that rewards whistle-blowers who disclose high-quality, verifiable information. Under these new rules, the SEC created a program to encourage people to report and provide evidence of actual or potential securities fraud. Tipsters whose information proves crucial to a case could get 10 to 30 percent of the penalties over $1 million. The SEC&#39;s first payment under this program was $50,000 to an informant who alerted regulators to a major investment fraud.</p><p>This new brand of whistle-blowers dishing out dirt from deep inside corporate America are less interested in fairness of the functional stability of the marketplace than they are in getting a cut of the potential multi-million dollar penalties offered by the SEC. Sadly, their actions are motivated by Economics 101 &mdash;&nbsp;not Ethics 101.&nbsp;</p><div><p><em>Al Gini is a Professor of Business Ethics and Chairman of the Management Department in the Quinlan School of Business at Loyola University Chicago.</em></p></div></p> Thu, 13 Sep 2012 05:00:00 -0500 http://www.wbez.org/blogs/bez/2012-09/whistle-blowing-guilt-or-greed-102374