January 21, 2011
Thank you for giving the general public the opportunity to influence the upcoming decisions of this formidable body. Two points of interest that I would encourage further development and clarification by the Commission members:
1. Corporate Whistleblowers (Case #2007-SOX-35 ALJ 05/09/08, Jefferis v. Goodrich Corporation
2. Proposed Whistle Blower rules and rewards.
As a corporate whistle blower who actively provided significant, material, well documented information to the Securities Exchange Commission as well as the SEC Office of Inspector General over the past several years, I have a very unique perspective.
My allegations of insider trading, accounting irregularities, harassment, discrimination, and other possible international criminal activity (export non-compliance) were first reported while I was employed at at publicly owned and NYSE listed global aerospace company as a Sarbanes-Oxley Risk and Control Specialist. Initially, Occupational Health and Safety Administration (OSHA) assumed responsibility for investigating my Sarbanes-Oxley complaint of egregious violations. This resulted in a quick and bizarre blanket unsubstantiated dismissal with just days after my unlawful termination of employment. The OSHA ruling was immediately appealed in August 2007.
I filed a Freedom of Information Act request with the U.S. Department of Labor in September 2007 to obtain the investigator notes and to recycle the thousands of pages of evidence which I provided the OSHA investigator. This information was forwarded to the SEC Enforcement attorney I had been communicating with since early 2007. I filed a request for expedited treatment of my FOIA request (OSHA FOIA Request #07031) in February 2008 which was denied because mt request for expedited treatment failed to explain precisely WHAT I was going to say and HOW I was going to say it. The US Department of Labor was also concerned that I was using mt FOIA request for expedited treatment to obtain information outside the normal attorney fee laden and delay prone discovery process. Rather than helping a corporate whistle blower, the United States government began a campaign of truth obstruction and oppression of information.
The United States government apparently does not want my story, and probably many others, to see the disinfectant of USA daylight. This letter today is the closest I can come to making a public statement about my painful experience and let me share with the public my complete lack of faith or trust I have for the Securities Exchange Commission and the United States Department of Justice.
The outcome of my appeal is immortalized in the recently published book: Whistleblowing:The Law of Retaliatory Dischange, Second Edition, 2008 Cumulative Supplement (current through July 15, 2008)by Daniel P. Westman and Nancy M. Modesitt (published BNA Books ISBN 978-1-57018-719-3) Insider trading can form the basis for a reasonable belief about a violation of the enumerated categories of protected activity.
However, if the SEC and the Department of Justice fail to investigate, press charges, or hold criminal executives accountable under the law, what good are protections? Who is to be protected? What is hidden from the public? In the days just prior to the Administrative Law Judge's decision to dismiss my case, the CEO of the global aerospace company sold thousands and thousands of shares of common stock in unplanned sales. The company's Audit Committee was also informed, aware, and complicit. The company's external audit firm was also informed, aware, and complicit. The global accounting firm cited a non existent accountant-client privilege when asked to help expose the accounting fraud.
The information provided the Securities Exchange Commission was recently forwarded to the Financial Crisis Inquiry Commission for further review and examination. I am determined to let the general public, a jury of my peers, make the final assessment of the facts and circumstances and not let the SEC and DOJ obstruct Justice and suppress Truth.
Ms Shaprio and the other Commission members are encouraged to review my Pickens Plan Forum posting from just prior to the collapse of oil prices in July 2008. It would appear that mark-to-market forces of oil commodity prices may have been impacted by the "insider" or invisible-to-the-public alternative fuel patent information. The Goodrich executive had predicted a financial crisis if I ever made public the "secret" patent information.
We did not have a financial crisis in the USA until the mark-to-market collapse of oil commodity prices. Oil prices did not collapsed until after the PickensPlan forum posting and my reporting of insider trading related to the sensitive and controversial patent information. The SEC, Congress, and President do not want you to know they missed opportunity after opportunity to prevent the man created disaster we refer to as the financial crisis of 2008.
In September 2006 the US Department of Energy wrote about the insider information represented by the patents issued by the US Patent Office. "We have reviewed the patents and concur that the technologies described may be of value for the productions and use of hydrogen" lending tremendous credibility to the water as a fuel controversy and debate. Please be sure to read the September 2006 letter from the US Department of Energy. Why does the SEC believe it is taboo to openly discuss these patents in the context of a global warming crisis, Ponzi schemes, and other damaging financial hoaxes?
Please consider the academic work of the James Baker Institute for Public Policy - Who Is in the Oil Futures Market and How has it changed?
Much of the proposed whistle blower rules currently being considered require the whistle blower to exhaust all internal to the company reporting channels before coming to the SEC. You will not be surprised to learn that the Goodrich Ethics Hotline was my first reporting.
Forcing whistle blowers to report internally is not a replacement for the SEC or DoJ to enforce existing laws. My experience shows that reporting through ethics hotlines and other internal mechanisms merely allows the company to initiate constructive termination proceedings to eliminate the whistle blower's access. Many regulations are monitored for progress with a stop watch. The quicker a company can identify, isolate, and terminate a whistle blower, the more successful they will be at protecting their proprietary secrets.
Please go back to the drawing board on these whistle blowing "protection" rules. If the SEC and DoJ cannot enforce existing laws, the SEC and DoJ should be eliminated.
My recommendation to whistle blowers is to leave your employer before reporting any of your concerns internally or to Federal officials. Do not expect the SEC or DoJ to take action.
I was enticed to report the activities of my former employer by the SEC Insider Trading Bounty Program which was in existence in 2007. Now I know that few, if any, bounties were ever paid. There is no reason to believe that these new rules will prove to be different.