The business pages are lighting up this morning with the news that baby formula biggie Mead Johnson Nutrition — makers of Enfamil — is being bought by Reckitt Benckhiser (whose brands include baby-stopping Durex condoms) for $16.6 billion, but we’re more interested in a new whistleblower lawsuit from a former Mead Johnson executive who claims the company ignored concerns about defective packaging and fired her for trying to get the problem addressed. [More]
When a business is doing something shady and illegal, often the best-placed people to know about it are the employees who are supposed to carry it out. That’s why there are laws in place to protect whistle-blowers who report their employers to the appropriate authorities… and breaking those laws can sometimes land a company in as much trouble as doing the thing an employee would report them for to begin with.
A week after an internal investigation – aided by company engineers – uncovered carbon emissions issues with 800,000 Volkswagen vehicles, the carmaker says it will keep the door open for employees to share any cheating within the organization – as long as they do it by the end of the month. [More]
In most of the country, pharmacies can offer rewards points, coupons, or other inducements to get you to switch prescriptions to them. Not only is this illegal in certain states, it’s also illegal to offer these incentives to customers with health insurance through Medicaid. Kmart has settled allegations from a whistleblower that it did exactly that for customers with Medicaid, and accepted co-pay coupons for brand-name drugs for them. [More]
Despite objections from businesses, the Securities and Exchange Commission has passed a new rule that will allow whistleblowers to get up to 30% of any money the SEC recovers based on their tips. The rule also exempts whistleblowers from having to reveal their findings to the companies they’re reporting before going to the government.
The Securities and Exchange Commission is considering a proposal that would pay out rewards to employees who turn in their companies for wrongdoing, and businesses aren’t so happy about having bounties placed on their heads.
Instead of issuing a recall, after Johnson and Johnson discovered its Motrin caplets were defective, they hired a contractor to go around the country buy up all the drugs. It was a “secret recall” that left the bad medicine on shelves for months for consumers to buy. Now the Oregon AG is suing J&J. The story broke when one of the guys hired to do the buying faxed regulators the instructions J&J gave him.
Chase now requires bankers to drag customers waiting for a teller out of line so they can upsell other bank products. One longtime banker wrote in to apologize for the practice, which “blatantly exploits a customer’s trust,” and to encourage customers to call Chase and tell them that they hate it, too. Read the banker’s full heartfelt note, after the jump.
“Janice” has been working in the BP Call Center in Houston, answering calls about the disaster from all over the world, and she says she and her coworkers don’t think the calls are being sent any higher up in the company. “We’re a diversion to stop them from really getting to the corporate office, to the big people. I don’t want to get emotional, but it’s so frustrating when these people live right there [in the Gulf Coast] and nothing is being done to help them.”
The West Texas nurse who went on trial this past Monday for reporting a doctor to the state board was found not guilty after just an hour of deliberation, reports the New York Times. The jurors who spoke to the Times after the case said it seemed pretty cut and dried to them. Now the nurse’s lawyers are focusing on their civil lawsuit against the county, the sherrif, the county attorney–who is described in the article as the surgeon’s personal attorney as well–and the hospital administrator who fired the nurse for going over his head. Hooray for whistleblowers!
An anonymous RadioShack employee sent us what he considers unethical talking points distributed by the corporate office to help employees upsell the RadioShack Replacement Service Plan. According to our tipster, “each example encourages lying.” Read the deceptive talking points, inside…
The National Funeral Home in Falls Church, Virginia stores unrefrigerated corpses, including some bound for Arlington National Cemetery, in hallways and garages for months on end, according to embalmer-turned-whistleblower Steven Napper. The Funeral Home’s owner, Texas-based Service Corporation International, told Napper that they were unwilling to pay for refrigeration, which would prevent corpses from leaking and growing mold.
Remember TJX’s gigantic security breach problems last year, where data on 94 million accounts was stolen? Good for you, because apparently TJX doesn’t. A former employee of a TJX store in Lawrence, Kansas was fired recently for posting anonymous complaints online about the current sorry state of his store’s security, which included the store manager writing server login and password information on a sticky note, and the store resetting employee passwords to blank fields.
There’s a congressional hearing going on right now over the unsafe Southwest Airlines planes. It seems like the FAA’s Southwest Airlines operation was a smörgåsbord of delicious corruption that put many lives (and careers) at risk by becoming too cozy with the airline it was supposed to regulate.
Yesterday the FAA sought $10.2 million in civil damages from Southwest Airlines for neglecting to inspect the fuselages of 46 of its planes.
BusinessWeek has an article that shines some light on a conflict of interest between the airlines and the FAA safety inspectors. It’s the inspector’s job to make sure the airlines are operating safely—but inspectors who blow the whistle may face pressure from the airlines and retaliation from the FAA’s upper management
The inspectors are the on-the-ground cops who ensure that engines fire up properly, that the wing flaps function, and that all of the other complex machinery in an aircraft is in good working order. They have broad discretion to halt and delay flights–power that often rankles the thinly stretched, financially strapped carriers. When an inspector launches a formal investigation into an apparent safety violation at a passenger airline, something that happened more than 200 times last year, it often triggers costly repairs. And when the bill exceeds $50,000, the FAA must issue a press release alerting the world to the problem.