Before Enron became known for orchestrating one of the country’s largest accounting scandals, I alerted the company’s CEO, Ken Lay, to the irregularities I saw in financial reports. I was both optimistic and naïve that Lay could take action to save the company – my warnings were too late and my message too difficult to accept. Months later, after the company had collapsed under the weight of fraud and manipulation, I testified in front of Congress, only then to discover that Enron sought and received legal advice on the potential consequences of discharging employees who raise accounting concerns. I was shocked and dismayed to see that this advice to Enron was in a memo dated two days after I met with Lay.
Coming forward as a whistleblower was not easy, but I felt a sense of duty to report what I had discovered. Whistleblowers serve a valuable purpose in our society – one that keeps fraudsters at bay, exposes and prevents wrongdoing, and provides a check on abuse of power. My story is about just one example of fraud. In response to public outcry following this and similar high-profile instances of fraud, the U.S. Securities and Exchange Commission (SEC) established the agency’s own whistleblower program with help from U.S. Senator Chuck Grassley (R-Iowa), a long-time proponent of the False Claims Act (FCA). This federal law dating back to President Abraham Lincoln has recovered nearly $70 billion in stolen government funds since its inception, while…
