Hello. Welcome back to Conversations with
Stephen Kamugasa. This is the fourth episode
in our 2025 Leadership Series. Today's guest
is a friend of this podcast, Mary Inman.
Mary Inman is a partner at Whistleblower
Partners, a boutique law firm specializing
exclusively in representing clients and the
various USA whistleblower reward programs.
Mary was previously a long-time partner at
the San Francisco office of Constantine Cannon,
where she represented whistleblowers in the
United States for over 20 years. In July
2017, she moved to London for three years
to start the firm's international whistleblower
practice, which she oversaw until she left
Constantine Cannon to found Whistleblower
Partners. Mary now represents a growing number
of foreign whistleblowers who want to reveal
wrongdoing abroad that has a connection with
the United States. She also frequently assists
whistleblowers in submitting claims to foreign
authorities, such as the National Tax Service
of Korea, the Ontario Securities Commission,
the Canada Revenue Agency and His Majesty's
Revenue and Customs. In this episode, we
discuss the topic, exposing your blind spots,
the argument for fostering whistleblower
voices to become a successful leader. Mary
Inman, welcome.
Thank you so much, Stephen. It's a pleasure
to be here tonight.
Your insightful question was a key part of
my 2022 podcast interview with Guy Den, the
founder of Protect. The podcast in question
is entitled Whistleblower, an Angel, a Villain
or a Bloody Fool. I recommend it highly.
Specifically, you raised the connection between
the Economic Crime Transparency and Enforcement
Act 2022 aimed at exposing Russian oligarchs'
financial activities in London and HMRC's
discretionary whistleblower rewards. This
highlighted your clear support for policies
that compensate whistleblowers for providing
crucial information. But first, Mary, can
you please tell us something about your childhood
and how did your childhood prepare you to
become an effective and successful lawyer
for Whistleblowers?
You wanted to start at the beginning. I like
that. So I was born and raised in a very
small town on the Canadian border in Maine,
a little town called Holton. And I think
what prepared me best to be a lawyer was,
frankly, my parents. My mom was a lifelong
English teacher, and my father originally
was an English teacher as well, then went
and got his library sciences degree and became
a librarian. So I was raised in a home where
education, reading, inquiry, questioning
was always sort of the broth and the stew
that I simmered in. So I think questioning,
poking holes, debate was very much part of
our family dinners and just every part of
my life. So I really credit my parents with
creating the type of environment where I
learned to question it and felt safe to question,
but also just encouraging me to pursue my
passions. They didn't pressure me in any
way. They just exposed me to a lot of different
things. So I had a number of lawyers in my
family, not in my nuclear family, immediate
family, but a very close family member was
a justice of the Maine Supreme Court. And
he had very much an outsized influence on
me in terms of showing me just an introduction
to the legal profession and all that it had
to offer. It's really my family, I think,
that helped give me the insight to realize
that I was always someone who was very concerned
about human rights and justice. From a very
young age, I would complain mightily about
injustice, whether it's even just in fairness
in the home, whether my brother was getting
away with not having to do as many chores,
or even when I was in middle school, I remember
in a debate, I took the side early on that
I felt like women should be allowed to be
in combat roles in the military. So it's
just sort of, I've always sort of loved to
argue and advocate.
You had a great career at Constantine Cannon,
where you were. a partner for a long time.
While a partner at Constantine Cannon, you
did many great things, including joining
Shaifali Joshi-Clark, a senior forensic accountant
in the whistleblower office of the Ontario
Securities Commission as a co-panelist for
a webinar titled The Expansion of Whistleblower
Reward Programs in the US, Canada, and Globally.
I'm particularly interested in your career
trajectory. What motivated your decision
to transition from a successful position
at a well-regarded law firm to found your
own practice? Additionally, could you elaborate
on the key attributes and skills you believe
are essential for a lawyer specializing in
whistleblower cases?
Sure. So your first part of your question
was, why did I choose after 10 years working
at Constantine Cannon to embark on a new
chapter and co-found a new law firm? I think
one of the main reasons is that When I was
at Constantine, the firm was a much bigger
firm, about 50 to 70 lawyers, with multiple
different practice areas. And so whistleblowing
was just one of the practice areas. The firm
also did intellectual property. It did antitrust
competition law. It did other civil litigation.
So what often happens with lawyers is that
we create conflicts for each other. So I
think it really just became desirable to
a group of us. There were about 13 of us
who left and started our own practice to
be able to specialize. It's particularly
important, I think, with whistleblowers that
they know that It's a very dangerous position
to put yourself in to decide to blow the
whistle and you do so at great risk to yourself
personally and professionally. And I just
think clients have more faith when they know
that that's all you do, that there isn't
another section of your firm that actually
defends some of the very people or types
of corporations that you take on. It just
felt right for us to be able to say, this
is all we do. We represent individuals. We
don't represent the big corporations who
are the targets. And I think it makes a lot
of our clients feel much more comfortable.
But it also, for us, allows us to have a
full breadth of, and basically little to
no limitations on the types of targets that
we can take on, the companies that we can
sue on behalf of whistleblowers. At Constantine,
we were routinely, our wings were clipped
because we might bring in a case and it could
be against an existing firm client and then
we'd have to decline for conflict of interest
reasons. So it was an incredible place for
me to work. I thoroughly enjoyed my 10 years
there. And frankly, Constantine is a place
really responsible for a huge focus area
and passion in my career, which is through
their London office. I was allowed to practice
there for three years and really start to
advocate for whistleblower reward programs
internationally and also, most importantly,
attract international whistleblowers into
the US. I think a lot of People even in the
US don't know about these programs, let alone
globally. So it was just really terrific
and giving me the pulpit to start. recruiting
people and educating people that you don't
have to be American to use these programs.
And in fact, I think as we'll talk about
a little bit later, by definition, Foreign
Corrupt Practices Act violations, which whistleblowers
can report to the SEC and to the DOJ now,
by definition, those occur overseas, right?
It's the bribery of a foreign government
official. So it became a really great part
of my a tool set and toolbox to get to cut
my teeth in the international realm. And
I have Constantine to thank for that. Oh,
you asked about what attributes should a
lawyer have to represent whistleblowers?
I think what's probably little known and
appreciated, but probably one of the most
important skills is frankly, empathy and
emotional intelligence. Whistleblowers, as
I alluded to earlier, when they're in the
process of making the decision whether or
not to blow the whistle, it can be a life-changing
and life-altering decision. That being said,
sometimes our clients come to us and the
horse is already out of the bar and they've
already blown the whistle. But in those circumstances
where a whistleblower is deciding and gets
to make that choice, it really requires a
lot of sensitivity and a lot of skills that
they frankly don't teach you in law school
in terms of really managing your client's
expectation and testing them and pushing
them to see that I often say that if you
are a whistleblower who has a family, it
can be really important to make sure that
the family agrees with the decision because
it can have repercussions for the whole family.
And I've seen, for instance, research that
the New England Journal of Medicine did that
on pharmaceutical whistleblowers, whistleblowers
who exposed fraud in the pharmaceutical industry,
that they had higher incidences of divorce,
of alcoholism, substance abuse, depression,
because of the strains and the pressure.
So I think it really requires a lot of awareness
and ability to counsel. And because a whistleblower,
by the time that they're coming to us, they're
often an extremist. They're often facing
a very stressful situation or maybe in the
middle of it. And it's difficult often to
make those the best decisions when you're
in a state of stress. So a lot of what we
try and do is sort of, you know, try and
ground them and make sure that they're in
a place where they feel safe. to talk and
that they can logically think through what
the implications might be for them. So I
think that is sort of a skill set that not
all lawyers are required to have, but I think
it's particularly important skill set to
have when you're dealing with whistleblowers.
We may talk later today in the interview
about sort of the psychosocial impacts on
whistleblowers, unfortunately, we've seen
a number of whistleblowers, not only be blacklisted,
block listed from future job prospects, but
the sort of spiral that can happen can be
a downward spiral, which unfortunately, has
resulted in even suicide for some for some
whistleblowers. I know a lot of people are
familiar with John Barnett, the Boeing 737
Max whistleblower who took his life in the
middle of depositions in his case. But even
recently an open AI whistleblower named Sushir
Balaji. There was even a Theranos whistleblower,
a little known fact, who took his life under
the pressure. So it's an unfortunate, circumstance.
And again, I think requires whistleblower
lawyers, although we're not trained as therapists,
to have some real sensitivity and ability
to help the whistleblower see the full picture
and basically serve as a support system because
it can be incredibly difficult when you blow
the whistle in an organization. I think we're
now all, I think, as a result of the Me Too
movement, aware of the terms like gaslighting
and this sort of self-doubt that gets created
because often there's an approach taken by
companies. I've often said most companies,
regardless of industry, seem to have a corporate
playbook. which I think comes from the medieval
mindset that a lot of us are in, that when
a whistleblower blows a whistle, rather than
embracing them and thanking them for helping
be the canaries in the coal mine to help
the company to avoid risk, they often shoot
the messenger and make it. So the whistleblower
is just shining the light on a problem and
it's like a ricochet effect. Most companies
will all of a sudden say, well, really it's
about you, the whistleblower, which can be
completely disorienting. And then, you know,
they try and make an example of them and
often either fire them, demote them. And
that causes like everyone around them to
worry their fellow employees that this might
be contagious. And so they tend to get isolated
and then they start to doubt, am I the only
person who thinks this is wrong? So can be
a very stressful situation. process. And
I think a whistleblower lawyer needs to have
the human and emotional intelligence skills
to support someone through that, and guide
them and be there as a sounding board and,
and a gateway to more resources. We are very
strong. And like I said earlier, telling
our clients to make sure if they're comfortable,
that it'd be great to bring the family in.
It's also important to have therapy and to
be able to talk about the pressures so that,
and to start to rebuild and create new support
systems since they often have lost, you know,
not just their job, but all the social relationships
that come from that with coworkers and friends.
In the webinar mentioned earlier, You talked
at length about the qui tam provisions of
the US False Claims Act, which empower whistleblowers
to launch a lawsuit in the government's name
when they have information about fraud against
the government or one of its programs. Mary,
for someone living and working in New York
City, how would you describe the practical
significance of a whistleblower reward program?
Why should the average New Yorker be concerned
with these programs?
Yeah, I love that question because it kind
of goes to the heart of the work that we
do. So whistleblower reward programs are
really extraordinary. And the reason for
that is that the original whistleblower reward
statute is something called the False Claims
Act. It's also known as Lincoln's Law. It
came in in 1863 around the time of the Civil
War. And it was actually a concept that was
stolen from English common law. So this comes
from the seventh century when, before there
were police services, the king incentivized
and deputized private citizens to basically
expose when their neighbors were not observing
the Sabbath laws, for instance. So it's a
concept that allows whistleblowers, and in
the context of the Civil War, it was, whistleblowers
had information about unscrupulous defense
contractors who are selling gum powder cut
with sawdust, defective horses and military
equipment, and recognizing that it is very
hard for the government to detect that kind
of fraud unless they incentivize insiders
inside the very defense companies where the
bad behavior is occurring. There's some very
incredible testimony that was in the Congress
at the time that the bill was being passed,
that it said, it takes a rogue to catch a
rogue. Which is one of my favorite statements,
right? It recognizes that that's very difficult
for an auditor or an investigator from the
defense department to know what's going on.
But a whistleblower insider, which is the
prototypical whistleblower, can provide a
roadmap to the fraud. They can show exactly
why, when, and the knowledge requirements
that the company knew They were selling these
defective goods and they did it intentionally
to improve their profit margin. So, but what
makes it remarkable is under, in the example
of the False Claims Act, not only a whistleblower
doesn't just get to submit a tip, they get
to launch a lawsuit in the name of the government.
So they really are deputized as a private
attorney general. And I think why it matters
to, The average New Yorker, not just to prosecutors,
obviously prosecutors love these cases because
they're much easier to prove. The whistleblower
gives them all the smoking guns and the great
evidence and other testimonies. But to an
average New Yorker, why these programs matter
is because if you're working in a company,
like so many people are, if you have either
contracts with the federal government, if
you're a government contractor, or if your
business impacts some of the many other agencies'
work that also have rewards programs. So
for instance, if you're in financial services
in New York City, there's an SEC program
that allows whistleblowers to report on any
sort of securities fraud where investors
are harmed. There is a risk that you will
get caught So I think that deterrence is
one of the biggest things that people should
be aware of, right? That if you're in a company
and you don't speak up about any sort of
malfeasance, there's a very good chance someone
in the cubicle beside you may already be
incentivized to speak to the government and
cooperating with them. So detection, the
chance of detection is increased. And so,
you know, malfeasance is more likely to see
the light of day, which can be seen as a
good thing or a bad thing depending on what
side you sit on. But I think, You know, I
think it's one of the strengths of these
laws is they tend to be a very much a bipartisan
issue that no one's really pro-fraud. Who
wants taxpayer dollars to be misappropriated?
You know, Republicans and Democrats can both
get behind that. And that's one of the things
that I've seen in my career, Stephen, is,
you know, when I started, it was just the
False Claims Act was the statute that was
in existence and then Since that time, the
IRS, the SEC, the CFTC, I know this is American
alphabet soup for all of our agencies, the
Transportation Department, the Treasury Department,
and even now DOJ has just within the past
two weeks adopted an antitrust program. So
clearly, this is a growth industry, clearly,
The inside information whistleblowers provide
is invaluable and in fact, supercharges the
enforcement. efforts by all of these various
agencies in the government. And you know,
it goes back to something we've seen before
this idea that we pay confidential informants
is really, that's something that we see around
the globe. It really sort of picks up on
that notion, and has been enormously successful.
And I think that is really proof of why people
should pay attention. It's not just limited
to private contractors these days. Whistleblowers
are now incentivized to report on tax fraud,
securities fraud, sanctions violations, money
laundering, antitrust, bid rigging, you name
it. So it becomes increasingly riskier to
engage in this behavior with the prospect
of insiders being incentivized to speak up.
On March 13th, 2025, you posted on LinkedIn
the following, and I quote, after advocating
for this result since 2017, during my work
in London, I'm so chuffed to see this news
that HM Revenue and Customs will be adopting
a US and Canadian style program, guaranteeing
rewards to whistleblowers who bring actionable
information about violations of UK tax laws.
In the US, empowering tax whistleblowers
has been a proven strategy for success. Between
2007 and 2023, the Internal Revenue Service
collected 6.9 US billions in proceeds as
a result of whistleblower informant tips.
This program will go a long way towards recouping
the 5.5 British pounds lost to tax fraud
in the UK every year. Eight years is a long
time for an advocacy work. In a 2022 podcast
interview with Guy Dehn, which I mentioned
earlier, Guy posited a cultural divergence
between the Americas and England regarding
the monetization of information Specifically,
he suggested a reticence among the English
to directly exchange information for monetary
compensation. Mary, to what extent do you
believe this cultural factor contributed
to the protracted eight-year timeline? If
it was a significant factor, what actionable
strategies would you recommend to cultivate
a more normalized culture of information
monetization within the English context.
This is one of my favorite questions, frankly,
is to talk about the cultural differences
between the UK and the US. as it comes to
incentivizing paying whistleblowers. So I
absolutely believe that these cultural differences
are what led to a very long and protracted
period of resistance to these ideas. After
Dodd-Frank, so the Dodd-Frank Wall Street
Reform Act is when we ushered in, in the
United States, in the wake of the financial
crisis, we ushered in the new SEC whistleblower
reward program. And it was, and that, you
know, it took off rather quickly that it
really got on people's radars. There were
a number of successes, and it really put
the SEC on the map. And so not shortly after
that, around 2014, so that The program came
in and really was started in earnest in 2010.
And in 2014, the UK's Financial Conduct Authority
did an analysis and said, should we do this?
We're now seeing some success in the US.
And basically, the decision was, it's just
not British. Or as they like to say, it's
not cricket. And so they had some reasons
that were more substantive, but I think it
really came down to the cultural piece of
it. And it's certainly what I observed during
my three years living there. You know, literally
people would step back when I told them what
I did, they would just, you know, shake their
head. And, you know, the idea was, it's not
British, we're British, we blow the whistle
because it's the right thing to do. We don't
need to be paid for it. And somehow being
paid for it tarnished the moral righteousness
of the act. And the more I observed that,
and it was really almost to a person that
I would get this visceral reaction. The more
I observed it, the more I realized that a
lot of it comes from a bias about Americans.
Brits want to be different than Americans,
right? And we obviously, we all want to be
unique. And I think Americans are perceived
by Brits rightly or wrongly or stereotypically
as overly transactional and overly mercenary.
So this was an idea that was not attracted
to them for that reason. Like we don't want
to become like those transactional mercenary
Americans. And so to the second part of your
question, like how did this change? What
were the strategies we adopted? A lot of
it came from, you know, people like me and
other folks talking, not just me, many others,
but saying that you don't have to do it the
American way. Like you can make your program
British. There are many ways to do it. For
instance, if you look at how another Commonwealth
country, Canada, adopted these programs,
they had smaller raiseds of rewards. So in
the US, it's usually 10 to 30% that a whistleblower
can receive of a fine as a finder's fee for
their providing the information. In Canada,
it can be five to 15, and sometimes they
put caps on it. A lot of the complaints that
British people have is that we, I think the
word they use is gobsmacking amounts of money
often gets rewarded to whistleblowers. The
largest reward I'm aware of is $275 million.
So, you know, you can put a cap on that,
other things like you, but I think what really
turned the tides is when, at least in my
experience, I was working with the all party
parliamentary group for whistleblowing and
one of the co-chairs of that group was a
woman named Baroness Susan Kramer, who's
still a strong champion for whistleblowing
generally in improvements to the Public Interest
Disclosure Act. And she seemed representative
to me because it was clear when she started
to make speeches about rewards, when she
started to think about it less as a bounty
and more as unemployment insurance, that
it sits more as a financial safety net, just
another form of protection. When she thought
about it that way, it felt more British to
her that these people are undertaking a risk
on behalf of the public interest. And as
a result, they often lose their job and their
livelihoods. So isn't really what Americans
call a reward? Isn't it really more just
like unemployment insurance, or a safety
net. And, and that I think helped her make
it feel like it's more British if she put
it into her own context. So I think, I think
a lot of that is what finally turned the
tides, frankly, the fact that the labor government
is now in place, there's a minister by the
name of David Lammy, when he was a shadow
minister before labor became the party, the
government party in office. I think he did
a tour of the US and became enamored of reward
programs and had actually even put it into
the labor party platform. So there seems
to be a perfect storm right now in a good
way of the labor government that is trying
to close the tax gap, deal with budget shortfalls,
and recognizes that confidential informants
properly incentivize can be indispensable
in helping supercharge enforcement efforts.
So I think it's a little bit of both. And
also I would commend to your audience an
incredible research paper done by a British
group think tank associated with the Ministry
of Defense called RUSI, the Royal United
Services Institute. They have a Center for
Finance and Security. And a woman by the
name, a researcher by the name of Eliza Lockhart
wrote a lengthy A research report came out
in December of last year that said, basically
concluded that the use of whistleblower incentives
would really serve the British government
well in fighting financial crime. So I feel
like a lot of that has sort of all come at
the same time and it's resulted, I think,
in a bit of a shift in the opinion, a pretty
radical shift for me because I think it went
from a lot of groups just saying it's not
British to all of a sudden, even now, the
head of the serious frauds office, Nick Ephgrave,
is a strong champion of rewards. Even the
FCA has started to change their tune. And
obviously, as you mentioned in the preamble
to your question, HMRC will be hopefully
adopting, it's announced its program, it
will be launched this fall. So I within the
next month or two, we'll be hearing more
about that. So it's rather remarkable. And
I, as I said earlier, to quote my British,
favorite British expression, I'm quite chuffed.
Your 2014 podcast with Evan Epstein on boardroom
governance was insightful. I especially appreciated
your emphasis on a broad approach encapsulated
in your quote, which I'll quote here. the
arc of the moral universe is long, but it
bends towards jobs. However, this contrasts
sharply with the reality of whistleblowing,
which is often career-ending, particularly
within institutions like the UK's National
Health Service. For those unfamiliar with
your excellent interview with Evan Epstein,
which I strongly recommend, could you describe
the emotional journey of the whistleblower.
Specifically, how should young lawyers guide
their clients facing this difficult decision?
Perhaps you could give us an example.
Yes, absolutely. So I'm definitely quoting
the good Dr. Martin Luther King there. His
famous quote is, the moral arc of the universe
is long, but it bends towards justice. And
for whistleblowers, hopefully it bends towards
jobs as well. The emotional journey of a
whistleblower typically follows a path that
starts with them maybe not even knowing they're
a whistleblower. So it can be a path of confusion
at first. So if you, for instance, are the
head of internal audit, if you're a chief
compliance officer, it is your job oftentimes
to deliver bad news, right? Like we can't
do this, that's, you know, this would transgress
certain laws, or I just did an audit that
says we need to pay back, you know, $500
million to the US government because of an
accounting irregularity. So they often bring
that information forward just as part of
their job, not thinking that they're gonna
be turned into a whistleblower. And I've
often said it's companies who create whistleblowers
often by how they react to the information
that individuals are bringing. So it can
often be very disorienting. The first part
of the emotional journey is that they bring
this information, they're doing their job,
and all of a sudden, Instead of being applauded
or rewarded by, you know, good performance
evaluations for doing the work, speaking
the hard truths, they all of a sudden start
to be shut out of meetings, denied promotions.
They may have, often the case with many of
my clients, they've had years and years and
years of great performance reviews. all of
a sudden they're found not to be a team player,
reasons, pretextual reasons, pretextual reasons
start to show up about, you know, oh, someone
who might've been chronically late their
whole career, all of a sudden it becomes
a problem. And they start, you know, they
start to just be mystified. Again, that this
idea of, Because you've spoken an inconvenient
truth, we're going to make the problem about
you, the messenger, rather than looking at
the message. Companies, just like humans,
when they're criticized, will often get in
a defensive crouch and not be in a growth
mindset set. So that can be really disorienting
for for a whistleblower that, you know, they
don't even know they're a whistleblower and
all of a sudden they're getting retaliated
against and they don't know why. And so the
journey will often start under very stressful
circumstances at work, because that's the
typical whistleblower is an insider whose
employer is engaged in illegality. And so,
you know, particularly for Americans where
so much of our self-worth, I think, is derived
from our jobs. I think that's true of many
humans, but Americans, we have a workaholic
type tendency that when you start to suffer,
you know, so much of your social connection
and your self-worth comes out of that, all
of a sudden, you know, you're probably likely
on your way to losing your job. that can
be incredibly difficult. As I described earlier,
you lose your social network from work and
you may find it difficult to find another
job. I had a client who was featured in the
New Yorker magazine who for years kept getting
job interviews and doing pretty well, but
up until the point of where references were
needed and then he wouldn't hear again. And
that was because the employer that he exposed
for Medicare fraud seemed to have been spreading
the word that you don't want him in your
organization because he's a whistleblower.
So. You know, and then you end up without
that job, you start draining your 401k, your
retirement plan, your family. If you're the
primary breadwinner, there's a lot of stress
placed on your family. I can't tell you how
many whistleblowers often end up being dog
walkers or in just like people, a very vault.
of vaulted statuses. One of the most famous
whistleblowers in the UK was one of the top
cardiologists. And after exposing the NHS,
he's never worked again. I mean, it's such
an enormous brain drain, not just a tragedy
for him, but a tragedy for all of us, right?
That we lose the services of these people.
So you fall, it's like needing an air mask,
right? You drop in altitude. make a huge
drop, which is disorienting and can have
all these ramifications that I talked about
in the New England Journal of Medicine. But
it's not all bad. For some whistleblowers,
it is all bad. But for many whistleblowers,
particularly ones where they're able to get
their information to a government agency
that wants to act on it. My clients don't
do this for the money. The money is there
to help them as a safety net. But mostly
they want whatever it is that they raise
to be addressed and for someone to correct
it. And so there can be an enormous amount
of Pleasure taken, but that's many years
later, right? Because the other part in the
whistleblowers journey is once you get that
information to the government, if it's a
massive fraud, it can take many, many years
before the government ends up imposing a
fine. be there being a jury trial and a verdict
or a judgment or settlement. So at the very
end of the day, a lot of my clients have
enormous success, but it can feel like a
marathon getting to that place and a lot
of ups and downs and a lot of patience. And
that's really where the role of the whistleblower
attorney and a lot of amazing whistleblower
support NGOs that are support organizations
can really help whistleblowers get through
all of that. And frankly, one of the best
things we can do for whistleblowers is to
help predict for them what's going to come
so that they can manage their expectations.
So I can't tell you how many people call
me early in the process and they start to
describe what's happening. And when I say,
I think they're on their way to firing you
and they're just shocked. I said, I don't
know, but this has all the earmarks of it.
And this seems to be where it is. If you
can at least prepare someone for that, it
at least helps deal with some of the blows
and actually if they can get a good employment
attorney and things like that who can get
them a negotiated structured settlement out
the door, it can limit some of the damage.
In fact, as part of an employment negotiation,
you can often require or negotiate good recommendations
or at least a neutral recommendation so it
doesn't hurt your future career as much.
So there's just a lot that can be done. So
if we can empower them, it can impact their
journey. But it can be incredibly emotionally
trying. And the more we can demystify the
process and get them to the government, people
who will valorize them for this, rather than
the fact that they were vilified. As Guy
from Protect was saying, you know, there's
a whole raised of our whistleblowers, heroes,
villains, They frankly just want to be neither.
They'd like to just have it be a normal act
that doesn't have to change your life. And
I think we'll talk about that more in a minute.
How do we listen to whistleblowers so that
they don't get turned into villains? So yeah,
in terms of how do we counsel in a specific
example, You know, I have a client who has
sued a major health insurer in the United
States for Medicare fraud. And, you know,
a lot of the guidance that I've followed
was we involved his wife in the decision-making
early on. And I think that really helped.
She had a lot of questions. And I think a
lot of people forget that This is a, there
are a lot of people behind that whistleblower
who's taking that act. So I feel like that's
an example that I learned pretty early on
through some not so good experiences with
whistleblowers having a hard time. I learned
that it would be good to get the family involved
early.
In your January 2025 article, DOJ reaches
historic settlement with MA Plan Independent
Health. and former executive in Whistleblower
Case, which was published in RAC Monitor,
you wrote thus, and I quote, the case is
remarkable in several ways. It's the largest
ever Part C settlement with a health plan
purely based on a whistleblower case. It
is also one of the first, if not the first
settlement with a vendor for allegations
of risk adjustment fraud, and notably includes
an individual executive at the vendor Gaffney,
who agreed to pay two million U.S. dollars
to resolve the allegations against her. Can
you give us a straightforward explanation
of what risk adjustment fraud is, and what
are the defining characteristics of a successful
false claims act lawsuit?
Absolutely. So risk adjustment fraud, for
folks who are not familiar with the US Medicare
program, our government health insurance
program, sits within something called managed
care. So when we say Part C, there are three
different parts of Medicare, Part A, Part
B, and Part C, and managed care is Part C,
and managed care is a lot like HMOs. So it's
a fairly new concept where in Medicare Part
A, which tends to be hospital and doctor's
offices services, there's something called
fee-for-service Medicare, where the way that,
you know, doctors are reimbursed when providing
services is based on each individual service.
So the more you bill, the more money you
make or the higher reimbursement you get
from the United States government. Part C
turned that on its head and said, we're instead
going to pay the health insurers a fixed
amount based on actuarial analysis. So if
you're a 72-year-old woman in Florida, we're
gonna pay you X amount. And then, you know,
if you can deliver the services for less
than that monthly capitated payment, capitated
amount, then you pocket the difference. But
if not, if you go over, then, you know, you're
still, you're gonna go in the red. So it
incentivized health insurers to be more preventive,
to engage in preventative care. But one of
the things that happened early on was that
it was susceptible to cheating. And so a
lot of insurance plans, when they had enrollment
periods, when they're trying to recruit people
into the plans, the health insurers would
have the enrollment fairs on the fifth floor
of a building with no elevators offering
gym memberships. So they're clearly trying
to self-select for healthy patients. And
so Medicare revised the program and said,
okay, you get a set amount every month based
on the actuarial demographics we talked about.
But you'll get a multiplier called a risk
adjustment factor, which is the multiplier
for every comorbid condition that a patient
has. So if you're treating someone with a
lot of comorbidities, with pulmonary disease,
with diabetes, cancer, history of stroke,
heart attack, those sorts of things, For
each of those different conditions, you'll
get a multiplier, and those multipliers can
stack up. So what do you think happened?
So a lot of companies realized you can make
a lot more money if you make patients look
sicker than they are. So we started to see
conditions like severe malnutrition, which
although that is sometimes a problem in the
US, it's not a super prevalent problem, We
actually often have the opposite problem
with morbid obesity and the prevalence weights,
because that risk adjusted, it went off the
charts. So you started to see these health
plans, not all of them, but many of them
encouraging doctors and incentivizing doctors
to upcode. So a famous example that I gave
in Teresa Ross's case, the independent health
case you just quoted, was a patient we called
Sunny D The medical record of the office
visit at issue showed that his past medical
history had shown that he had suffered an
episodic incident of depression. And it was
connected to, I think his sister had died.
And so he was an elderly patient. And when
they brought him back for this visit, they
looked at, the notes from the doctor was
that he had a sunny disposition. That's why
we called him Sunny D. But yet the billers
and the coders at the health insurance plan
went back and billed major depression based
on that prior reference in the medical record
because that risk adjusts and gives them
the higher multiplier. So we saw many, many,
many examples of that. So it wasn't being
done by the doctors necessarily. It was being
done by coders from the health insurance
plans later on as they were combing through,
we would often say mining for codes. It's
been really a thrill of my career to represent
four or five whistleblowers who brought these
types of allegations to the Justice Department
about major health insurance plans cheating
and defrauding the Medicare program by overbilling
for conditions that are more extreme than
what the patient actually has. I think you
had a second part to that one.
What are the defining characteristics of
a successful False Claims Act lawsuit?
Yeah, I think it really, so the False Claims
Act is a civil fraud statute. So it can't
just be negligence. You need to be able to
show that the the government contractor knowingly
submitted false claims to the government,
so false invoices typically for payment.
So it can be very helpful to have the kind
of scenario where it's clear that the company
was aware of the problem. So you don't have
to have actual knowledge. If the company,
like, covered their eyes and covered their
ears. The standard is like reckless, engaged
with reckless disregard for the truth of
the facts. So put their heads in the sand
or reckless indifference, deliberate indifference,
reckless disregard. You need to have information
that clearly the company was aware or should
have been aware and was deliberately ignorant
and not following the rules or finding out
the information. So it's really important
for it to really be fraud and for it not
to just to be some technical violation of
something that any person innocently could
have done. So that's what really makes a
successful False Claims Act is a whistleblower,
typically an insider who has observed the
wrongdoing and preferably has documents to
to corroborate what was going on. You don't
always have to have documents, but it certainly
can help. Yeah, a well-placed whistleblower
insider who saw, had visibility into the
decision-making and saw that it was intentionally
the law was violated. That can be, if not
a slam dunk, a very strong false claims that
case.
The title of our podcast is exposing your
blind spots, the argument for fostering whistleblower
voices to become a successful leader. Now,
a distinguished fellow at Washington and
Jefferson College, Jonathan Gottschall, writing
in the Harvard Business Review on October
16, 2018, published an article entitled,
Theranos and the Dark Side of Storytelling.
He said the following, and I quote, According
to Nick Bilton's absorbing expose in Vanity
Fair, Theranos, a company once valued at
nine billion US dollars, got as far as it
did mainly on the strength of a pretty naturally
good story. Holmes constructed an inspiring
hero narrative starring herself, a precocious
girl genius who, at 19 years of age, began
pioneering medical technologies that could
potentially save millions of lives around
the world. Despite abundant warning signs
and despite the Silicon Valley Company's
refusal to provide real evidence that their
technology worked, journalists didn't skeptically
evaluate Holmes' story. They simply repeated
it. They told and retold Holmes' story until
she began to seem less like an active person
and more like a living symbol of progress,
of innovation, of female empowerment. The
problem, as the Wall Street Journal's John
Carreyrou has reported in more than a score
of articles, was that there was little to
Theneros beyond its story, and the story
was mainly fictional. Very In keeping with
our podcast theme, what's the primary benefit
for a leader in fostering a culture where
whistleblowers are hard? And why is the open
exposure of corporate governance blind spots
so vital?
Yeah, this is one of the areas where I am
most passionate is in sort of debunking the
myth that whistleblowers are disloyal and
embracing the notion that not only are they
not disloyal, they're among your most loyal
employees. And the reason for that is the
answer to the question that you asked is
why is it so important to listen to whistleblowers?
Because they're your eyes and ears and they're
your best risk management tool. There's a
wonderful social behavioral scientist named
Christine Hunter who has renamed whistleblowers
Forward Indicators of Risk. They're risk
detectors, they're canaries in the coal mine.
So if you're interested in knowing where
your vulnerabilities lie and who wouldn't
be, who shouldn't be as a company, you want
to know your blind spots, the name of your
podcast, these are guides to your blind spots.
And these are the people who, don't succumb
to the pressure of, it's very easy to be
a yes person and to kiss the ring and to
not raise, as I love to say, inconvenient
truths. These very people are the people
who have the intestinal fortitude, the temerity
to speak the hard truths and explain when
you're doing wrong so you can course correct.
And I often say to people, In your personal
life, who are the people in your personal
life who hold you to account, hold your feet
to the fire when you're not being your best
self? They're the people who care for you
the most. So I think that's very true in
the corporate setting as well. So unfortunately,
most people in the boardroom, in the C-suite,
approach whistleblowers as people who need
to be contained and exited when in fact,
you know, they're just shining a light on
a problem that you should investigate. You
shouldn't be looking at them beyond just
corroborating. Like 99% of the whistleblowers
I represent never have to take the stand
because there's, and they're not great witnesses,
right? Because they have a financial motivation.
But you don't need to have them take the
stand because in 99% of the cases, there
are other people who can corroborate it.
people need to do is investigate what the
whistleblowers are looking at and not look
at the messenger. It's so irresistible, right?
We want to know who is raising the concern,
but in a way it's best if you don't and you
just see. So now a lot of these internal
reporting mechanisms allow for anonymized
reporting. And in a way I think that's great.
It's obviously more protective of the whistleblower
and that's the state of the art, the industry
requirement in many countries. But there's
a good reason for it because you're just
looking at the facts and not the person raising
the concern. So I would love to see people
recognizing that these are really heroes.
and people who are to be applauded and rewarded
and noticed in their performance reviews
for raising concerns. Um, there's great research
that has been done that if you aren't persuaded
by my argument here, there's empirical data
that actually says, um, and shows that listening
to whistleblowers, um, improves your ROI,
your, your bottom line, it's more profitable.
So the, there were two graduate business
school professors, um, Stephen, uh, Stephen
Auberys and Kyle Welch. They're at the University
of Utah and George Washington University,
respectively. And they were given access
to an anonymized data set from NavX Global,
one of the largest providers of internal
reporting software for all the major corporations.
And when they unpacked the data, they were
able to show, which involved hundreds and
hundreds of companies, they were able to
show that companies whose hotlines were I'm
ringing off the hook who are getting lots
of. Reports were more profitable than companies
whose hotlines are silent. And that almost
seems counterintuitive right if it's silent
you like there must be no problems if it's
silent and of course. Every organization
their problems that need to be reported and.
The one that was ringing off the hook had
created a culture where people felt safe
to speak up and clearly. they were acting
on and those reports and using it to course
correct. So hopefully, you know, I always
say to people who are in compliance and other
areas where like, what can I do to persuade
my C-suite that they need to invest in the
type of training and culture creation that
engenders trust for people to feel like they
can safely speak up. And I always point to
this research study by saying it makes good
business. And of course, probably what is
going on here behind these numbers, why they're
more profitable. And I think this is part
of what the researchers concluded is that
you have fewer lawsuits The lawsuits you
do have probably settle for less money because
you may have voluntarily disclosed to the
government as a result or things like that.
You don't have to suffer the huge brand damage
to the brand and reputational damage that
can come. You look at a company like Boeing,
I don't know that they'll ever recover from
that with planes continuing to go down. It's,
to me, it's a really, one of the reasons
I'm honored to be on your podcast is because
it gets to this, the crux of this very issue,
which is a cultural change, a debunking of
myths, a really, asking people to address
the prejudices and the biases we have against
whistleblowers, which frankly come from,
you know, medieval times, shoot the messenger.
You know, the British expression is don't
put your head above the parapet, it'll get
shot off. We all as children are told not
to be snitches, grassers, daubers, tattletales.
We have rats. We have all these horrible
names. But at the same time, you have, that's
what childrens are told, not to tell tales,
but same time we say in, you know, airport
settings, if you see something, say something,
or on the tube, right? I think we need to
challenge that bias that we see whistleblowers
as snitches and instead see them as real
assets to any organization. And that's obviously
a brain shift. You gotta take your brain
out and flip it around. And that's why I
love to be on podcasts like this one to encourage
people to really recognize their biases.
There's a wonderful whistleblower named Wendy
Addison who did, and I think still does,
virtual reality trainings of teaching people
to listen up. Because it's one thing to encourage
speak up, but how you react to someone speaking
up is really important so that you obviously
don't retaliate. And so she does sort of
scenarios, hypothetical scenarios, role-playing
that kind of encourages people to try and
see how they handle the situation. In fact,
I haven't talked to Wendy about this, but
just recently Anthropic, the AI company did
red team testing. And one of the prompts
that they gave to the agentic AI was that
there was some fraud happening in a pharmaceutical
company. and they told the AI to act boldly
and the AI submitted a whistleblower tip
to the, I think to the FDA and the SEC or
something. So even the AI robots are blowing
the whistle these days, Stephen.
On February 10th, 2025, President Trump halted
enforcement of the Foreign Corrupt Practices
Act in an executive order, arguing the move
would aid American businesses abroad. What
does this mean for businesses operating in
the US and globally?
So that was a real blow to the rule of law,
honestly, and just sort of the status of
the United States government as one of the
leaders in anti-corruption bribery laws.
We had one of the first laws and then the
UK Bribery Act, Sap and Deux, other laws
have followed. But for a long time, we were
kind of the police officer of the markets
trying to make sure that there was fair play
and competitors were not at a disadvantage.
So it was very discouraging to see that put
on pause. Since that announcement in executive
order, it was a six-month pause. And recently,
last month, the pause was lifted. And the
Foreign Corrupt Practices Act will continue
to be enforced, but in a very limited way.
So sort of the guidelines and in a very America
first kind of way, which is really unfortunate
because Whereas previously we'd seen American
companies like Walmart and other companies
pay huge fines for violating the FCPA, the
new guidance out of the Trump administration
suggests that in an America first kind of
way, the only kind of cases they'll want
to bring are ones that touch on where an
American company has been harmed. So it doesn't
feel like a level playing field. It feels
like moving forward, we'll only be going
after foreign companies that have a US nexus
or presence. And it seems very one-sided.
But that's where we sit, I'm afraid. You
know, what we've seen is during that time
of the gap, the six month gap where no enforcement
was happening, we saw the UK, France and
Switzerland jump into the breach and create
a task force on anti-bribery to pick up the
slack that was left. And I think we'll continue
to do that. So I guess I would say that's
a bit of a silver lining is that it really
has required other countries to be more aggressive,
recognizing that the United States has pulled
back in many ways on its FCPA enforcement.
But to me, it's a bit demoralizing.
Finally, Mary, please advise our listeners
where they may connect with your law firm
whistleblower partners.
Yes, so we have a website. It's www.whistleblower.law.
We are on LinkedIn, Bluesky, Instagram. So
you can find us at our handles at all of
those places. But the best place to start
is with our website where you can see myself
and my other partners and associates. and
read our blog and find out what we're doing.
Mary Inman, thank you very much for being
a guest on this podcast.
It was my pleasure, Stephen. Thanks for all
the great questions and all the due diligence
you did and, um, and, and finding out, uh,
what the whistleblower laws in the U S as
relates to rewards do.
Thank you. This podcast was brought to you
by the Kamugasa Challenge in partnership
with Democracy in Africa. Democracy in Africa
is a platform dedicated to building a bridge
between academics, policymakers, practitioners,
and citizens. The fifth episode in our leadership
series is entitled Reimagining the Media
in a Liberal Democracy, an interview with
Alex Renton, a British journalist, broadcaster,
and a visiting fellow at Newcastle University.
The podcast will go live on October 13th,
2025. If you enjoyed this podcast, please
click the share button in your app to send
this episode to a friend. Thank you very
much for taking the time to listen to this
podcast. Until next time, goodbye.