QUIZ: Whistleblowers

Quiz: Whistleblowers

The number of tips from whistleblowers to the Securities and Exchange Commission has spiked in the last year. Until 2009, the SEC received one or two such tips per month. However, since July 2010, the agency has been getting tips at a rate of one or two per day. What’s changed?

What’s changed is that the Dodd–Frank Wall Street Reform and Consumer Protection Act was signed into law. It provides whistleblowers with the opportunity to collect very large paydays for providing "original information" that leads to the discovery of fraud exceeding $1 million. According to SEC, this has led to a situation where the agency now receives regular, high-quality tips, often submitted through an attorney.

How much do you know about whistleblowers? Take our quiz and find out.

Posted 8 February 2011

Which industry has paid the overwhelming majority of whistleblower fraud settlements?

1. Defense
2. Finance
3. Pharmaceutical
4. Real Estate

The overwhelming majority of whistleblower fraud settlements have been paid by the pharmaceutical industry. Of the 20 largest False Claims Act lawsuits that have been settled, all have been related to the health care industry. Of the top five, HCA Healthcare has paid two, Merck has paid one and another has been paid by Tenet. However, the largest settlement was paid in September 2009 by Pfizer, which settled charges related to the marketing of Bextra for $2.3 billion, the biggest fraud settlement in pharmaceutical industry history.

Pfizer Pays $2.3 Billion to Settle Marketing Case
New York Times

“Deep Throat” was an alias used by Watergate whistleblower Mark Felt, who had resigned from what government agency?

1. Central Intelligence Agency (CIA)
2. Committee for the Re-Election of the President (CRP)
3. Executive Office of the President (EOP)
4. Federal Bureau of Investigation (FBI)

Mark Felt was associate director of the FBI. He retired in 1973 and began leaking information about the Watergate scandal to Washington Post reporters Bob Woodward and Carl Bernstein. His tips ultimately led to the resignation of President Richard Nixon. Speculation raged for decades about the informant’s identity, but Felt himself revealed the truth in May 2005, at 91 years of age. He died three years later.

What was the largest award ever paid to an individual whistleblower?

1. $32 million
2. $64 million
3. $96 million
4. $128 million

The largest award ever paid to an individual whistleblower is $96 million. It was paid in 2010 to Cheryl Eckard, a quality control manager for GlaxoSmithKline, as part of a $750 million judgment over manufacturing violations that she discovered in 2002. Eckard reported the problems to her supervisors, but rather than resolve them, the company fired her. She filed a lawsuit, and GlaxoSmithKline eventually agreed to pay $750 million in settlements and fines. $96 million of that award went to Eckard.

Glaxo to Pay $750 Million for Sale of Bad Products
Source: New York Times

Jeffrey Wigand was a whistleblower that worked in what industry?

1. Automobile industry
2. Fast food industry
3. Firearms Industry
4. Tobacco Industry

Jeffrey Wigand worked in the research and development department of the tobacco company Brown and Williamson. He made headlines when he alleged that the company knowingly added chemicals to their cigarettes that created greater nicotine delivery and, ultimately, made them more addictive. His allegations caused the CBS television show 60 Minutes to conduct an investigation, and his story also served as the inspiration for the 1999 Russell Crowe film The Insider.
Source: Tickerspy JeffreyWigand.com

What is the maximum percentage of awards that whistleblowers can collect under the Dodd-Frank act?

1. 10%
2. 20%
3. 30%
4. 40%

Under the Dodd-Frank law, whistleblowers uncovering financial fraud are eligible to collect between 10% and 30% of whatever the government collects from those lawsuits. That can potentially lead to very large payouts, particularly in cases involving pharmaceutical companies, which are often settled for very large sums of money.

For Whistle-Blowers, Expanded Incentives
Source: New York Times

Attorney Stuart Meissner ran advertisements to attract whistleblowers at theaters showing what movie?

1. The Boiler Room
2. The Informant
3. The Insider
4. Wall Street: Money Never Sleeps

Whistleblowing is more lucrative than ever before, and this applies not just to the informant but also to the lawyer. Hoping to attract such clients, attorney Stuart Meissner ran advertisements for his practice at movie theaters showing Wall Street: Money Never Sleeps, the 2010 sequel to the 1987 Oliver Stone film, Wall Street. The advertisements gave out a link to Meissner’s website, SECsnitch.com.

Get Snitch Quick
Source: New York Post

What aerospace and defense company settled a whistleblower lawsuit in January 2011?

1. Boeing
2. Goodrich Corporation
3. Lockheed Martin
4. Northrop Grumman

In January 2011, Lockheed Martin settled a lawsuit with the US government for $2 million. According to the suit, the company had submitted false claims for a contract with the Naval Oceanographic Office Major Shared Resource Center, for exactly that amount. A former employee of the Mississippi-based center filed the suit.

Wendell Potter, who testified against the HMO industry, was once an executive for what US health insurance company?

1. Allstate
2. CIGNA
3. MEGA Life and Health Insurance
4. State Farm Insurance

Wendell Potter is the former vice president for corporate communications for CIGNA, and he testified to the US senate against his own industry in June 2009. In his testimony he claimed, among other things, that insurers purposely offer convoluted paperwork for the sick to fill out, in the hopes “that people will just simply give up and not pursue it."

Senate Panel Hears of Health Insurers' Wrongs
Source: The Washington Post

What 1983 film was based on the true story of a worker who testified about lax safety at nuclear power plants?

1. The China Syndrome
2. Liquid Sky
3. Norma Rae
4. Silkwood

Silkwood was a 1983 film starring Meryl Streep as Karen Silkwood, an Oklahoma nuclear power plant worker. Karen Silkwood testified to the Atomic Energy Commission in 1974 about conditions at the plant where she worked, chief among them regular exposure to nuclear contamination. After testifying, Silkwood herself became heavily contaminated, which she believed was the result of malicious intent by her employers. She had intended to bring evidence of her suspicions to a meeting with a New York Times reporter, but she was killed in a car accident on her way to the interview.
Source: Center for Occupational Health in Automotive Manufacturing

What organization does whistleblower Sherron Watkins now wish she had reported Enron to?

1. The Houston Mafia
2. The Knights of Columbus
3. The Securities and Exchange Commission
4. Wikileaks

Had they existed at the time of the scandal, Enron whistleblower Sherron Watkins claims that she would have reported the energy company to Wikileaks. In a January 2011 interview with a Houston news station, she said, “If I had to do it all over again and there was a WikiLeaks, I'm almost certain I would have availed myself of that tool.”

Enron Whistleblower Would Go to WikiLeaks Now
Source: Accounting Today

Your score:

• Insider – You are familiar with privileged information at the highest levels.
• In the know - You possess knowledge of a few bits of sensitive information.
• Outsider – You are far removed from the inside track.

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