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    Businessmen asking themselves what’s wrong with the world should be most concerned about their own ethics.
Dennis GrubaughGrubaugh    Lack of good ol’ moral principle continues to plague us as a country. From the pulpit to the boardroom, we seem to have lost our way. Lying seems easier than ever. Or stealing. Or cheating.
    It’s full-bore scary during election season when the mud flies so fast and furious you’re not sure who to believe. In the end, you can’t believe anyone and hope that the vote you cast — if you bother to vote at all — goes to the person with at least a modicum of positive character. You might say that’s no way to run a country, but it’s the glory of our democracy.
    It’s certainly no way to run a business. It was the actions of some of America’s most important financial companies that led Congress in 2010 to establish the Office of the Whistleblower, a division of the U.S. Securities and Exchange Commission that encourages people to report suspicious activity or tips about securities wrongdoing. It came about as part of the Dodd-Frank Act, the most extensive financial regulatory reform movement of our times, prompted by the reckless shenanigans of Wall Street execs a few years before.
    This particular whistleblower program was created to provide monetary incentives for people to report possible violations of federal securities laws. Eligible whistleblowers are entitled to an award of between 10 percent and 30 percent of monetary sanctions collected in actions brought by the SEC and related agencies.
    For the record these whistleblowers have to be in the middle of big-time scandals. An “eligible” whistleblower is defined as “a person who voluntarily provides ... original information about a possible violation of the federal securities laws that has occurred, is ongoing, or is about to occur. The information provided must lead to a successful SEC action resulting in an order of monetary sanctions exceeding $1 million.”
    There are other laws dealing with other levels of whistle blowing, both federally and by state, but the SEC is really concerned about the biggest of the bad boys.
    A rare example of the program’s success came in mid-summer when the SEC awarded more than $400,000 to a whistleblower who reported a fraud to the SEC after a company failed to address an issue internally.
    This whistleblower (never identified by the SEC) provided the agency with specific, credible information that allowed for a more rapid investigation. The whistleblower tried on several occasions to have the matter addressed internally and was concerned that the company’s actions would do harm to investors.
    According to the SEC, through mid-September, 175 entities and individuals have been charged with securities crimes (70 of them senior officers) and $1.87 billion in penalties have been ordered or agreed to in the years since the Great Recession.
    The first American law adopted specifically to protect whistleblowers was the 1863 U.S False Claims Act, which tried to combat fraud by suppliers of the U.S. government during the Civil War. That act, which was revised as recently as 1986, also offers whistleblowers a percentage of the money recovered and protects them from wrongful dismissal.
    While my sense of right and wrong suffers from current effronteries, it doesn’t make me feel much better to know that our government has had to encourage whistle blowing for 150 years.
    Dennis Grubaugh is editor and partner of the Illinois Business Journal.