Watching the Watch Dogs

According to a story by Jean Eaglesham in the Wall Street Journal, at least two employees working for SEC’s Inspector General have filed complaints alleging that he and his senior staff retaliated against them for calling out misconduct within the inspector general’s office.

The allegations center on potential time and attendance fraud by a supervisor in the inspector general’s office and a junior subordinate. The whistleblowers said the two employees regularly disappeared together for several hours during workdays and engaged in inappropriate conduct in the office. The office’s own investigation of the complaints found insufficient evidence to conclude the two employees had an inappropriate relationship, but noted that “the supervisor created the appearance” of such a relationship. The SEC Office of Inspector General referred the complaints to a federal prosecutor, who declined to pursue the case

It was a case of the process being wrong.

The whistleblowers’ concerns focus on how Carl Hoecker, the SEC inspector general, handled their complaints.  The whistleblowers allege that the internal investigation wasn’t sufficiently independent to be fair. They also claim that they suffered retaliation for voicing their concerns.

Federal agencies have inspectors general to oversee the agencies and to encourage whistleblowing. They are supposed to be a model for private firms.

The internal probe was led by two senior officials in the office. But one of those was a senior investigator who hired and supervised the two employees at the center of the complaints. Of course there is an inherent conflict. If the employees were misbehaving, the supervisor would look bad for not having dealt with the problem.

Now the Office of Special Counsel is involved. That office is yet another federal agency whose primary mission is to safeguard the mer​it system by protecting federal employees and applicants from prohibited personnel practices, especially reprisal for whistleblowing.

I’m not sure there is much here for the underlying case. A supervisor may have been canoodling with one of his co-workers. You stop that prevent all the likely harm and drama that comes along with that. But the lesson for compliance is to make sure the process looks transparent and that the whistleblower understands what is going on . Now the whistleblower problem is bigger than the original problem.