FOR IMMEDIATE RELEASE: December 11, 2011
Significant Number of Americans Have Knowledge of Workplace Misconduct and are Willing to Blow the Whistle, According to Labaton Sucharow Survey
34% of Americans are Aware of Wrongdoing in the Workplace;
78% of Americans Would Report Misconduct
New York, NY (December 11, 2011) – Labaton Sucharow LLP today announced the results of its nationwide Ethics & Action Survey
. Conducted by ORC International between November 17-20, the survey questioned 1,000 Americans on their knowledge of wrongdoing in the workplace and willingness to come forward and report it.
With significant financial rewards and strengthened anti-retaliation and anonymity protections offered under Dodd-Frank, an overwhelming 78% of respondents indicated they would report wrongdoing in the workplace if it could be done anonymously, without retaliation and result in a monetary award. In fact, more than one-third (34%) of respondents knew about wrongdoing in the workplace. However, 68% were unaware that the Securities and Exchange Commission (SEC) has a new Whistleblower Program designed to protect and reward individuals who report violations of the federal securities laws.
Jordan A. Thomas, partner and head of the Whistleblower Representation Practice at Labaton Sucharow commented: "It is disheartening to see that wrongdoing in the workplace continues to be so widespread. However, the findings affirm the need for, and value of, the SEC's Whistleblower Program. This program, in concert with other regulatory reforms, has the potential to dramatically enhance investor protection and restore public faith in the markets."
A former Assistant Director in the SEC's Division of Enforcement, Jordan played a leadership role in crafting the Whistleblower Program enacted under Dodd-Frank. The program offers strong anti-retaliation protections and financial awards of 10-30% of monetary sanctions collected at the conclusion of a successful enforcement action. In mid-November, the SEC issued a report regarding the operation of the program to date. As highlighted by the report, since the SEC established a whistleblower hotline in May, it has received over 900 calls from members of the public.
Further, during the seven-week period between the time the final whistleblower rules went into effect and the agency's fiscal year end September 30, 2011, the SEC received 334 whistleblower reports alleging a wide spectrum of securities violations such as "market manipulation, corporate disclosure and financial statements and offering fraud." If this trend continues, the number of whistleblower submissions is likely to exceed the number of cases that the Enforcement Division actively investigates at any one time.
Labaton's Ethics & Actions Survey also revealed the following:
- 79% of respondents would encourage a loved one to report wrongdoing if he/she could do so anonymously, be protected from retaliation, and receive a monetary award;
Women were more inclined to encourage a loved one to be a whistleblower (82%) than men (75%);
- 49% of respondents with annual household income between $75,000-$100,000 reported that they had observed, or had knowledge of, misconduct at work. Interestingly, this percentage dropped to 29% for those respondents with a household income above $100,000;
- 37% of White/Caucasian respondents said they have observed or had knowledge of wrongdoing in the workplace, while that figure dropped to 33% for Black/African-American respondents and 22% of Hispanic respondents;
- 83% of those surveyed between the ages of 45-54 would report misconduct if done anonymously, protected from retaliation and with monetary award. However, only 74% of respondents at an earlier age in their career, aged 18-34, would report, even with those protections;
- 68% of Americans surveyed are unaware of the new SEC Whistleblower Program. There was an eight point spread between men and women with respect to knowledge of the SEC's whistleblower program, 64% and 72% respectively;
- Regionally, 66% of Americans in the South versus 71% of respondents living in the Midwest are unfamiliar with the program. Further, 67% of metropolitan residents compared to 72% of non-metropolitan residents are unfamiliar with the program.
"In strengthening protections and incentives for whistleblowers, the federal government recognized that law enforcement authorities cannot effectively and efficiently police the marketplace without the assistance of private individuals and entities," continued Jordan. "Accordingly, now, more corporations will establish a culture of integrity in their organizations and individuals will courageously report wrongdoing wherever they find it."
About Labaton Sucharow LLP
Labaton Sucharow LLP, with offices in New York, New York and Wilmington, Delaware, is one of the country's premier law firms comprehensively representing businesses, institutional investors and consumers in complex securities and business litigation. It is consistently among the top plaintiffs litigation firms based on its rankings in Chambers & Partners
, The Legal 500
, The National Law Journal's
Plaintiffs' Hot List, and Benchmark Plaintiff
. The Firm has been a champion of investor and consumer rights for close to 50 years, seeking recovery of current losses and necessary governance reforms to protect investors and consumers. More information about Labaton Sucharow and the Whistleblower Representation Practice is available at www.labaton.com
Jennifer S. Bankston