McPherson Statement

 

My journey as a whistleblower began over a decade ago when I first became aware of what I believed was a billion dollar fraud that was similar to a Ponzi scheme and involved 22,000 unsuspecting investors." I remembered the horrible impact the Madoff scandal had on his investors. I knew I had to do something. I could not sit back and watch that happen again, but I did not know what to do, and there was no guidebook to follow. I would have to find my own pathway forward based on instinct, experience and intuition.

I found the process is more complex than I expected and I pursued a number of unproductive and time consuming missteps before I managed to find my way into the SEC's whistleblower program. Once there, the SEC enforcement division opened an investigation and did phenomenal work to stop this $1.4 billion fraud and return $1.2 billion to investors. I cannot say enough good things about working with them.

I was very fortunate to have thirty years of forensic accounting experience, where I would take complex accounting matters, simplify them, and create expert reports for attorneys. That background was ideally suited to this work, so much so that I did not consider hiring an attorney, and I did the case on my own. In that respect, my ability to succeed as a whistleblower is somewhat unique.

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I would tell anyone thinking about becoming a whistleblower that it can be the most meaningful work you will ever do in your life. I found the experience so personally and professionally gratifying that I have done ten other cases with the SEC. Each one has been rewarding in a different way, even those that do not succeed. The work has given me the opportunity to work with five SEC offices, the FBI and the Department of Justice. I have learned through these experiences that one person can still make a difference and you can be that one person.

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I would also tell anyone thinking about becoming a whistleblower that it can be some of the most difficult and challenging work you will ever do. For those of you who are up to the task of being a whistleblower, here is some advice that I would give to help you succeed, which is based upon more than a decade of experience being a whistleblower.

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When you see something that calls you to action, I would suggest that the first thing you do is pause. The first steps you take as a whistleblower are the ones that are most fraught with peril. A bad decision at this point could blow up your case, limit your case or potentially disqualify you as a whistleblower. The best thing you can do is seek the advice of someone with experience, whether it is this organization, me, another whistleblower or a federal agency. You need to know how to deal with your situation, what obligations you have to report internally, what steps you should take to protect yourself, and what information might be useful to law enforcement. These are the things that you want to not learn by experience, but by the advice from experts. It saves time and money.

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While there is no guidebook to being a whistleblower, I would suggest reading the Harry Markopolos book, No One Would Listen, to gain a sense of the experience of being a whistleblower. Harry spent many years chasing Bernie Madoff and played an instrumental role in getting the Dodd Frank's whistleblower program put into law. Many of the obstacles Harry describes in his book no longer exist thanks to his efforts.

Next, you need to decide whether you want to enlist the support of others.

My experience has been that the likelihood of success increases when at least one other person is added to the team, particularly in the larger and more complex cases. One person cannot know everything and you may only be seeing a part of something much bigger. Expanding the team is a sensitive process with potentially adverse consequences. This is not a question that must be answered on day one. You can submit a case and then build it out to a bigger case with others involved. Again, I would recommend seeking the advice from someone with whistleblower experience.

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The next step is preparing an initial whistleblower submission. There are many great cases that never reach the point where an investigation is opened because the submission fails to create law enforcement interest. My cases are usually very complex and the challenge is not finding or proving the fraud, it is making it understandable. Ultimately, a case cannot be so complex that a jury cannot understand it. It is very helpful to offer to meet with law enforcement or to put on a presentation. The more interaction you have at this early stage of the process, the more likely it is that you can address any concerns with the case.

Once you have an idea about the perceived weaknesses of your case, you can take steps to address them. This is another area where a whistleblower could benefit from the advice of someone with experience. My experience is that if your case ends up in the hands of law enforcement, your work has not ended, it has only begun. Law enforcement is usually under-resourced and your helping hand will be appreciated. The best situation is when law enforcement has questions or asks for assistance, which is when your role will be most appreciated.

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Finally, I would suggest that when you first decide to reach out to get assistance seek advice from an organization similar to this one or an experienced whistleblower instead of initially contacting attorneys. Whistleblowers or nonprofit whistleblower organizations will be an excellent resource to find a qualified law firm with a fair fee structure.

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In closing, being a whistleblower can be one of the most important things you can do in your life. Your actions can have a profound and positive impact on thousands, even tens of thousands, of people's lives, in some cases preventing them from experiencing financial ruin. In order to be successful, you need to make the right decisions at the right times. Reaching out to an organization such as this one, or to me, or to another experienced whistleblower can be invaluable.As someone who has done this before, you may be starting the most important undertaking of your life, so be sure not to take any unnecessary chances. A lot of people may be depending upon your success.