In the Age of Whistleblowers, How to Coax More Internal Reporting Reply

It’s been over a year now since the Dodd-Frank whistleblower provisions went into effect, and they seem to be proving themselves hugely effective.  In 2012 alone, the Securities & Exchange Commission (SEC) received over 3,000 whistleblower tips, including 115 that were FCPA-related.  In August, the SEC made its first payout of nearly $50,000 to a tipster who reported fraud by his employer.

Many companies are responding by redoubling their efforts to encourage internal reporting.  But nurturing a strong internal disclosure program is something of an art, requiring a certain level of sensitivity to balance both the interests of the company and the interests of the individual.  While some disclosures are frivolous and malicious, others, that may be substantial, can become lost or forgotten in piles of paperwork.  We’ve listed here some tips to help those developing in-house disclosure programs maximize the number of employees reporting problems internally before they seek outside help:

  1. Announce the program widely.  Are employees properly informed about how and when they can report issues?  It’s amazing how many may not even know that an internal disclosure program exists.  More…