I was at an all-day seminar oragnised by the
International Fraud Group (IFG), yesterday. There were various discussions
related to the issue of combating fraud and the one discussion that caught my attention
was a discussion on whether countries should change their legislation to reward
whistleblowers.
https://www.sec.gov/news/press-release/2023-89
The main thrust of the SEC’s argument was that it made
the payout because it wants to encourage whistleblowing. Whilst this was an
amazing story, an American lawyer on the panel rightly pointed out that the
system was not perfect.
Let’s face it, the topic of paying people for doing anything
other than a nine-to-six job is something that many people struggle with. Call
it the mentality of “I work so many hours a day for x number of dollars and so
and so just makes one report and gets so much more.”
Whistleblowing is a particularly tricky topic in that
it is more often than not an act that requires you to go against an organization
or individual who has power over you. In school boy terms, you’re literally being
a “grass” or a “snake,” to the hand that feeds and more often than not, to the “team”
that you’ve grown up with. There is, in a lot of human societies thrive on
concepts of “loyalty” to authority. That, as an Estonian member of the audience,
pointed out, can be tricky, when you come from a society where people are
terrified of “telling-on” people or oragnisations to the government. Post-Soviet
societies are particularly terrified of this because they are trying to get out
of a culture where people were terrified into “telling-on” their neighbours. A German
speaking member of the panel made the point that the term “whistleblowing” in
German is “informant” which has negative connotations.
Let’s face it, whistleblowing is not something that
comes naturally and there are justified concerns that people may become “whistleblowers’
to get “revenge” on employers and that evidence provided by “whistleblowers”
may be tainted if there’s a “reward” motive.
I get these points. Well intentioned systems can be
abused. The welfare system in many Western countries is an example. The
intention to ensure people don’t starve when they’re out of a job is a noble
intention. However, the system has in plenty of cases “disincentivized” work. Rewarding
whistleblowing can lead to abuse. So, the question is, why should you encourage
people to be “disloyal.”
However, the case of not wanting to “reward” people
for being “disloyal” has one fatal flaw, which is, it works on the assumption
that people in authority are by default the good guys. One of the panelists in yesterday’s
discussion is Ms. Ruth Dearnley, who is the CEO of STOP THE TRAFFIK Group, a
charity dedicated to combating human trafficking. Her argument was simple –
without whistleblowing she wouldn’t be able to do what she does. In Ms. Dearnly’s
is in the business of helping victims of crime and relieving a menace.
To put it simply, those of us who happen to be working
professionals living in a place where there is a “rule of law,” sometimes fall
into the trap of thinking that everyone is like us. We go to work, which we may
not necessarily like, does provide us with a reasonable livelihood. If you’re
in a profession like law, accountancy or medicine, there is no need to “tell-on”
your boss unless its an extreme “life-threatening” case. Members of any given
profession have to comply with rules governing the profession as well as the
laws of the land. So, whistleblowing only comes into our daily lives in extreme
circumstances. – “Why rock the boat unless its life threatening?”
However, the sad truth is that the majority of the
world’s population is not working professional and living in a country where there
is rule of law. The fact remains, that in the majority of world, being an “honest”
and “law abiding” person is the fastest way to die and easy to be tempted and
tricked by anyone offering you better prospects. Go into any given red-light
district, and you’ll find a young girl who thought she was going to work in a
factory but was forced to get “f***ed” to keep other people rich. Ms. Dearnly
had examples of boys who could use a computer and dreamed of working for a big
IT company only to find themselves crammed into a cell, forced to run “love-scams.”
Let’s face it, these are stories that most of us know
exists but they are usually things that don’t even enter our conscience. Yet, these
cases exist. The world actually has people who are forced into situations where
they are effectively prisoners of the “bad” people who profit from harming
other people.
I believe that right thinking people will want the “bad
guys” brought down and every right-thinking person will want “victims” to be rescued
so that they can get on with life. However, you are not going to get that
scenario unless people who are victims come forward.
Now, if it is challenging to get someone like me to
come forward to do the “right-thing,” let us imagine what it is like to get
someone who gets beaten up or tortured at the whims of their proverbial bosses.
Sure, I may have my disagreements with my boss but I am NEVER in danger of losing
my life or having harm done to my family as a result of those disagreements. At
the most, I quit or get fired and work in a different industry but I don’t have
a reason to move from where I am.
That’s not the case for people who are victims of trafficking,
whether they are in sex work or forced labour. How do you get these people to
help you out.
Yes, the SEC case is sensational. However, when you
discuss the issue of whistleblowing, you are not asking people to try out for
the lottery. You are asking them to stop the bad guys. Unfortunately, bad guys
have a way of doing bad things to people whom they perceive may be a problem.
You need to tell people that you will stop bad things
from happening to them if they do the right thing. They need to be able to “feel
secure” if they do the right thing, whether that is to ensure basic protection
both financially and physically.
No system is perfect. Abuses can happen. However, if
you were to weigh up the cost and reward of incentivizing whistleblowing, its
clear that society would be far better off if people felt secure enough to do
the right thing.
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