Blowing the Whistle on Fraud - Sarbanes-Oxley´s Provision That Protects Employees Who Report Wrongdoing May Pose Problems

The recently enacted Sarbanes-Oxley Act received widespread attention for its provisions requiring that certain officers and directors of public companies certify their companies' financial statements, prohibiting most corporate loans to officers and directors and the destruction of auditing documents, creating the Public Company Accounting Oversight Board and regulating potential conflicts of interest relating to accounting firms and stock analysts. The act drew attention also for the criminal penalties it imposes. Discussed less often is the provision of the act that protects whistleblower employees.