As a managing director and chief enterprise officer for Countrywide Financial Corp. in 2005, Michael Winston raised the company profile for leadership development, implemented programs designed to hone executive skills and organize succession plans. His efforts were rewarded with two promotions in his first 15 months on the job.
By the end of 2006, after Mr. Winston reported to the California Occupational Safety and Health Administration that employees were getting sick from a potential contamination inside of the Countrywide building and after he told ratings agencies that the company went through a six-month period without an acting CEO, Mr. Winston’s experience took a drastic downturn.
Over the next two years his programs were canceled, his staff dropped from nearly 200 to two, and he was relocated to four different cities, with one relocation forcing him to move to another building 100 feet away after only a week in place.
Mr. Winston was fired from Bank of America, which purchased Countrywide in 2008 in a $4 billion stock transaction, but he said the retaliation didn’t stop there. He said in May, Bank of America placed a lien to the tune of $96,523 on his home.
Mr. Winston’s whistle-blowing efforts were the first in a line of confessions preceding Countrywide’s sale and a subsequent $16.65 billion deal between Bank of America and the federal government to settle charges that Countrywide’s mortgage-backed securities were sold under false pretenses in the run up to the 2008 financial crisis.
Despite efforts to protect employee health and publicly traded interests, Mr. Winston’s safeguards under the Whistleblower Protection Act didn’t kick in until he filed suit against Countrywide — a scenario that Paula Brantner, executive director of Washington, D.C.-based Workplace Fairness, said happens all too often.
“Anti-retaliation provisions are there to ensure a company doesn’t take dramatic action, such as firing someone. But sometimes someone has to be fired to have that protection. Sometimes not getting the promotion you expect to get or harassment at work would be sufficient depending on state laws,” said Ms. Brantner.
Federally, the Whistleblower Protection Act, the Dodd-Frank Act and the Sarbanes-Oxley Act all feature provisions protecting whistle-blowers. On a state-by-state basis, protections vary from Alaska’s law applying only to public employees to California’s law, which covers all employers.
Whistle-blowing laws also differ according to the violation being reported. For example, whistle-blowers have between 30 to 180 days to report retaliation or discrimination complaints to OSHA, depending on which violation the employee originally reported against a company. In the transportation industry, reporting times range between 60 to 180 days.
For consumer and investor protection laws, employees have 180 days to report retaliatory acts. There are 13 categories of potential whistle-blower complaints and dozens of individual violations that offer protection, according to the Washington, D.C.-based National Whistleblowers Center.
Confusion surrounding retaliation protection could be one deterrent preventing whistle-blowers from coming forward, but seemingly ironclad work agreements are growing into an even larger obstacle, according to Lisa Braganca, a securities attorney with Chicago-based Stoltmann Law Offices.
“The three biggest banks — JPMorgan Chase, Wells Fargo and Bank of America — all have codes of conduct online that are very vague, saying it’s meant to protect confidential information. Their codes of conduct don’t have instructions to employees to report violations of law. Instead they just include language saying, assume all information handled is confidential and you must get approval from a supervisor before discussing it.”
Ms. Braganca said the government and employees would be well-served by creating laws requiring company agreements to tell employees they have the legal right to talk to regulatory officials if they suspect illegal activities.
For Mrs. Brantner, collecting evidence and considering potential fallout is second only to seeking legal advice. Noting that whistle-blowers can receive a percentage of a settlement that the government reaches if the information they provide is critical to the case, she said knowing the legal ins and outs can help employees decide if violations they witness are indeed illegal and if a cut of a settlement is worth the initial price.
“A lot of wrongdoing isn’t actually an illegal action,” she said. “It might be wrong, it might be unfair, but is it illegal? You have to have evidence and work with someone who knows the law.”
For Mr. Winston, it’s still up in the air whether his sacrifice was worth the effort.
In June, he told The New York Times that he’s still fighting for a $3.8 million award for a wrongful dismissal and retaliation suit he won in 2011, due to two Bank of America appeals. In the last appeal, a jury reversed the verdict and charged Mr. Winston with $96,500 for court costs.
Meanwhile the former executive, who was once global head of worldwide leadership and organizational strategy at Merrill Lynch in New York, can’t find work that aligns with his experience.
In a personal account posted to the Washington, D.C.-based Government Accountability Project’s Whistleblower.org blog last week, Mr. Winston continued his call for recourse nearly eight years after reporting the first violation against Countrywide.
“In this three-part blog series, I’m going to detail the whole twisted, sordid tale: what I saw, why I initially prevailed and how justice was ultimately stolen from me,” he wrote. “If you are a lawyer reading these pieces and can help, I am in need of your assistance to right this wrong.”
Read Mr. Winston’s blog post at www.whistleblower.org/blog/093910-whistleblowers-story.
Deborah M. Todd: firstname.lastname@example.org or 412-263-1652. Twitter: @deborahtodd.