Olympus whistleblower accused of pension cover-up: British boss who revealed Japan's biggest corporate fraud sued for £15m

A British whistleblower who exposed one of the biggest frauds in Japanese corporate history is being sued for £15million by his former employer over claims he manipulated the pension scheme.

Michael Woodford uncovered a multi-billion-pound scandal with links to organised crime at camera firm Olympus Group when he became the company's first foreign chief executive.

It led to an outcry in Japan, wiped 80 per cent off the firm's value and saw three board members handed suspended prison sentences.

Now, five years after going public, Woodford and a former colleague are being sued for more than £15million over claims they conspired to maximise the pension scheme by unlawful means for their own benefit. 

The pair both deny the allegation, which Woodford said was an attempt to 'besmirch' his reputation while investigations into Olympus continued. He is counter-suing for a multi-million-pound sum. read more »

Whistle-Blowing Insiders: ‘Game Changer’ for the S.E.C.

Although there have been many complaints about the Dodd-Frank Act, one area generally hailed as a success is the whistle-blowing program at the Securities and Exchange Commission. Since the program’s creation in 2011, the S.E.C. has received more than 14,000 tips, including almost 4,000 last year.

That number falls well short of the original estimate of 30,000 submissions each year, but quality is far more important than quantity. Not surprisingly, agency officials heap praise on the program. Mary Jo White, the S.E.C. chairwoman, called it “a game changer for the agency,” while the director of the enforcement division, Andrew J. Ceresney, said that whistle-blowers “had a transformative impact.”

Figuring out how well a program is doing is always difficult because the sponsor has every reason to claim success. As the scandal caused by Bernard L. Madoff’s Ponzi scheme shows, it is as much a matter of taking whistle-blowers seriously as it is getting them in the door.

Five years into the program, it is clear that some of the best information comes from corporate insiders. They can give the S.E.C. a map to how a firm operates and where to look for wrongdoing.

A $22 million award to an internal whistle-blower at Monsanto announced last week is a good example of the impact an internal whistle-blower can have in showing the S.E.C. where there may be problems inside a company. read more »

Whistleblower receives massive payout

The whistleblower, who provided a “detailed tip and extensive assistance”, is receiving US $22 million – the second biggest payout ever given by the U.S. Securities and Exchange Commission. The whistleblower, a former Monsanto Co executive, tipped off the SEC about accounting misconduct related the company’s top-selling Roundup product. A statement said that the whistleblower played a key role in preventing illicit conduct at the firm. read more »

Experts address research fabrication lawsuit against Duke, note litigation could be lengthy

In a lawsuit brought under the False Claims Act, a former Duke employee says Duke faculty and administrators ignored and hid allegations of scientific misconduct, allegedly resulting in $200 million of funding based on fraudulent data.

Under the “qui tam” provision of the False Claims Act, a private citizen, also known as a whistleblower, can file actions on behalf of the federal government to recover federal funds provided due to fraudulent information. The FCA could hold Duke liable for up to three times the amount of the government’s damages, in addition to other civil penalties. Duke University, Duke University Health System, former professor of medicine William Foster and former clinical research coordinator Erin Potts-Kant are the defendants named on the case.

In March 2013, Potts-Kant was arrested on charges of embezzling more than $14,000 from Duke. Joseph Thomas, the whistleblower in the case against Duke, began working in the pulmonary division in 2012 where Potts-Kant and Foster worked. Thomas claims that the fraudulent research data Potts-Kant produced was knowingly used in writing research grants to the National Institutes of Health, Environmental Protection Agency and the Department of Health and Human Services. According to the lawsuit, the fabricated data led to more than $80 million in grant funding for Duke University and were used as the basis for grant applications by researchers unaffiliated with Duke totaling approximately $120 million. read more »

Significant Developments In Spoofing Cases: Coscia, 3Red and Sarao

As we have noted in previous articles, “spoofing” – placing non-bona fide orders with the intent to cancel prior to execution – remains squarely in the cross-hairs of exchanges, regulatory agencies, and the United States Department of Justice. Significant developments have occurred in the past several weeks in three important spoofing cases that are currently pending – two criminal cases brought by the DOJ, and one CFTC enforcement proceeding, all filed in the United States District Court for the Northern District of Illinois. The following is a brief summary of those key developments. read more »

Waste-to-Energy CEO Accused of $6M Scam

The chief executive of a waste-to-energy company has been charged with orchestrating a scam that defrauded professional athletes and other investors of at least $6 million, much of which he spent on personal expenses including alimony payments.

The U.S. Securities and Exchange Commission said Donald Watkins falsely told investors in Masada Resource Group that their money would be used to fund waste-to-energy projects and that Waste Management was seriously considering acquiring the firm in a multibillion dollar deal. read more »

Texas Woman Pleads Guilty to Preparing False Tax Returns

A Greenville, Texas, resident pleaded guilty today to one count of aiding and assisting in the preparation of false tax returns, announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division and U.S. Attorney John R. Parker for the Northern District of Texas. read more »