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Tips for Mitigating Whistleblower Risk

Whistleblower claims can present substantial risk to a business. Generally, whistleblower protection laws are designed to protect those who report misconduct that implicates some matter of societal interest. The various state and federal whistleblower protection laws cover a wide range of subjects, literally from “a” (airline safety) to “z” (zoo animal abuse). In the corporate environment, Section 806 of the Sarbanes-Oxley Act protects from reprisal individuals who report fraud that affects shareholders; any party that retaliates against a whistleblower can face significant sanctions.

Needless to say, whistleblower claims must be properly managed to mitigate the risk of financial and reputational harm that results from an adverse court ruling, a regulatory fine, or some other unwanted outcome. By implementing the following suggestions, the risk of that adverse finding can be significantly reduced.

Overview of Whistleblower Laws...

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