Study Proves the Value of Whistleblowers in Bringing Down Fraudsters. Exposing Misconduct.

Study Proves the Value of Whistleblowers in Bringing Down Fraudsters

August 31, 2017

A recent study published in the Journal of Accounting Research examines whether the participation of a whistleblower affects the outcome of an enforcement action against companies that commit financial fraud. The study seeks to quantify the impact of a whistleblower’s tip or assistance during an investigation on the final penalties levied on a company or an executive, in comparison to enforcement proceedings in which there’s no cooperation with government regulators. The study shows there is a stark difference in outcomes, but advises the results should be viewed with caution due to the large range of crimes studied, and wide assortment of outcome variables, including personal financial penalties, firm sanctions, and prison time.

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