Anonymous Reporting Programs and Employee Hotlines
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Transcript Anonymous Reporting Programs and Employee Hotlines
Anonymous
Reporting Programs
and Employee Hotlines
MySafeWorkplace.com
5995 Greenwood Plaza Boulevard, Suite 110
Greenwood Village, Colorado
800.650.7005
Your Presenter
Mr. Steve Foster is the President of
Business Controls, Inc. Mr. Foster’s 25
years of unique and diversified executive
and operational leadership experience
combines enterprise Governance, Risk and
Compliance expertise. He has expert
knowledge regarding the convergence of
security and technology, as well as top level
consulting and training in EEO/Internal
Controls matters. Mr. Foster’s expertise is
rooted in developing integrated SaaS
technology solutions in the Governance,
Risk and Compliance space. Mr. Foster
frequently lectures across the country on
the topics related to risk management,
ethics and corporate compliance,
conducting ethical workplace investigations,
fraud, workplace violence, and the
convergence of technology and security.
Mr. Foster is board certified in Security
Management (CPP designation) and in
Case Management for Internal
Investigations (PCI designation) by ASIS
International and is National Chair of the
ASIS Business Practices Council and he is
an ASIS National CPP Review Course
Instructor.
Quick Quiz
Fraud is most often revealed by?
1. A tipster
2. Chance
3. An audit
Quick Quiz
Most tipsters request anonymity?
True
False
Quick Quiz
Monetary incentives increase the
volume and quality of tips ?
True
False
“I am incredibly nervous we
will implode in a wave of
accounting scandals, and our
[successes are] nothing more
than an accounting hoax.”
“I am incredibly nervous we
will implode in a wave of
accounting scandals, and our
[successes are] nothing more
than an accounting hoax.”
—Sherron Watkins
Former Enron, VP Corporate Development
and Whistleblower
“The company is probably in the strongest and
best shape that it has ever been in…There
are no accounting issues, no trading issues,
no reserve issues, no previously unknown
problem or issues.”
—Kenneth Lay, Enron CEO
statement to Wall Street
Objectives
Examine the need, benefit and
value of anonymous incident
reporting systems
Discuss the key elements of an
effective AIRS
Learn how AIRS can improve
workplace safety and productivity
Questions and answers
Trends
More sophisticated crimes and
offenders
More victims of chance than
victims of choice
Greater use of technology
Larger losses
More litigation
Organizational Profile
Has no^crime prevention or
detection strategy
Ineffective or inadequate policies
Focuses on problems, rarely
solves underlying issues
Has communication problems
across all levels
Modern AIRS
Permits users to anonymously and
safely report illegal, unethical and
improper workplace behavior
24/7 toll-free telephone and Internet
access
Multi-lingual capability
Automated report distribution and alerts
Case management capable with
customized, detailed reporting
Key Benefits
Dramatically reduce losses from theft,
fraud and employee dishonesty
Effective barrier against workplace
substance abuse
Mitigates liability
Federally mandated for publicly
traded companies
Demonstrates to employees and
shareholders the organization cares!
Common Myths
False reports are common and create
liability
Employees are distrustful and won’t
make reports
Out-sourcing is expensive and
unnecessary, “besides, our open-door
policy does the same thing.”
All anonymous incident reporting
systems are alike
“I wish we would get caught.
We’re such a crooked
company.”
—Sherron Watkins
“I had every reason to think that the underlying
businesses, the fundamentals of the
underlying businesses, were strong.”
—Kenneth Lay
Enron Facts
5000 jobs eliminated
Stock went from $90 to Zero
$61 B shareholder value lost
$83 K lost per employee
Arthur Andersen, LLP collapsed
7th largest bankruptcy in U.S.
history
Enron Facts
Vinson Elkins billed Enron $27
million for its investigation of the
Watkins allegations
Time Persons of
the Year 2002
Sherron Watkins
Colleen Rowley
Cynthia Cooper
Enron Facts
Anderson billed $52 million for
audit and accounting services
the year prior
Sarbanes-Oxley
Applies to public companies only
Independent board and audit
committee
Assessment and disclosure
Disclosure of “material correcting
adjustments”
CEO and CFO certification
Section 301(4)
a) receipt, retention and treatment
of complaints…regarding
accounting, internal controls, or
auditing matters; and
b) confidential, anonymous
submission by employees…of
concerns regarding questionable
accounting or auditing matters.”
Consider
“Whistleblower” protection
implications
Confidentiality and discovery
issues
Contract and insurance coverage
Vendor’s skill and experience
Vendor’s promises and claims
Testing
Internal v. External
Internal Solution
Relatively easy to launch
Initial small investment
Rarely trusted
Very difficult to properly administrate
Significant legal exposures
Security, scalability, and
sustainability issues
Internal v. External
External Anonymous Incident
Reporting System (AIRS)
Very easy to launch, maintain, and
secure
Small investment
Highly trusted
Very easy to administrate
Significant legal protections
SaaS Model
24/7 Call center
Trained, multi-lingual call-takers
Internet interface
Flexible report dissemination and
retention system
Easy roll-out
Simple user interface
Consulting and support
Warning Signs
Low call volume
Missing or incomplete reports
Delays in receiving reports
All reports are anonymous
Allegations seem to all point to
one group or area
Litigation Avoidance
Follow policy
Retain all reports and document
findings and determinations
Treat all people with respect and
dignity
Protect confidentiality
Comply with the law
“We lost value in several equity
investments in 2000, $500
million of lost value.”
—Sharon Watkins
“The collapse of Enron and the subsequent
collapse of Arthur Andersen were
tremendous tragedies. But as I stated at the
time of my indictment on July 8, 2004,
failure does not equate to a crime.”
—Kenneth Lay
Questions?