Why Whistleblowers Get Paid in the U.S. but Not in Britain

U.K. regulators have rejected the idea of rewarding people who expose fraud at their companies.

In April, Barclays Plc said its chief executive officer, Jes Staley, was under investigation for trying to unmask an employee who’d raised ethical concerns about a senior staff member. Although the U.K. Financial Conduct Authority (FCA) says Staley wasn’t successful in identifying the so-called whistleblower, the incident raised questions about Britain’s scant protections for workers who aim to expose wrongdoing on the job—and highlights the difference between the British and American approaches.

In September the British government introduced rules that require companies to appoint a “whistleblower champion” and prohibit retaliation against employees who bypass internal reporting procedures and go straight to the regulator. Critics say a lack of financial incentives and the threat of being fired keep potential informants from speaking up. In the U.S., whistleblowing has been an important tool in the fight against white-collar crime since the Securities and Exchange Commission opened its Office of the Whistleblower in 2011. read more

Blacksands Pacific chief executive charged with $300 million fraud

A dual Nigerian and British national has been charged with defrauding financial institutions out of more than $300 million by falsely representing his company as a thriving international oil and gas venture to obtain loans.

Raheem Brennerman, chief executive officer of Blacksands Pacific Group Inc, was charged with bank fraud, wire fraud and conspiracy in an indictment unsealed Thursday in a federal court in New York. Federal prosecutors said he used ill-gotten loans to pay for a condominium in Las Vegas, travel, jewelry, clothes and spa treatments. read more »

Exxon Emissions Costs Accounting ‘May Be a Sham,’ New York State Says

For years, Exxon Mobil has insisted that its investment decisions take into account what carbon pollution will eventually cost the company.

But according to court filings by the New York State attorney general’s office, there is new evidence that the company has not actually followed that course, potentially overstating the value of its assets and defrauding its shareholders.

According to the filings, made by the state on Friday, “evidence suggests not only that Exxon’s public statements about its risk management practices were false and misleading, but also that Exxon may still be in the midst of perpetrating an ongoing fraudulent scheme on investors and the public.” read more »

The super-rich are different: they pay less tax

The Swiss leaks and Panama papers open a window on the tax-dodger’s world

OF LIFE’s two certainties, death cannot be dodged even by the well-to-do. Taxes are another matter. Quantifying quite how much they manage to keep from the taxman, however, has always been tricky. One common approach governments take is to conduct randomised audits of tax returns. This methodology can give regulators a rough sense of overall tax revenues lost. But it is far from ideal. For instance, studies based on randomised tax audits are usually both too small and too crude to reflect accurately the financial shenanigans of the most egregious tax-dodgers: the super-rich. read more »