It has been seven years since President George W. Bush signed the Sarbanes-Oxley Act into law, declaring that it contained “the most far-reaching reforms of American business practices since the time of Franklin D. Roosevelt.” One provision of the act, Section 806, was included to prohibit retaliation against employees who reported suspected fraud to higher-ups in the company. The drafters believed this whistleblower protection would encourage employees to speak up about fraud before another Enron or WorldCom could occur.
Yet, during the first three years after its passage, employees alleging Sarbanes-Oxley violations succeeded only 3.6 percent of the time at initial administrative hearings, and only 6.5 percent of those who appealed their denials won. Recent success rates show employers winning more than 98 percent of rulings from 2002 through September 2008.
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