Whistleblower Examples in Business: Theranos, Enron, Uber, Wells Fargo and More in History

The explosive whistleblower complaint concerning President Trump’s dealings with the president of Ukraine has put whistleblowing back in the headlines. Yet the practice is a longstanding American tradition, going back as far as Benjamin Franklin, who in 1772 passed secret British documents along to Samuel Adams.

As U.S. corporations have grown more powerful in the past half-century, corporate whistleblowing has become more common, precipitating many a corporate scandal. Around 40% of fraud schemes are unearthed through tips, the bulk of which come from employees.

Still, the act of passing along sensitive information has its risks. A 2013 study showed that 21% of whistleblowers faced retaliation, such as demotions and firings, verbal abuse or being ostracized by co-workers.

Here is a look back on some of the most notable acts of whistleblowing in the past several decades. While some have been celebrated in film, including Oscar-nominated performances by Meryl Streep and Russell Crowe, the more common fate for whistleblowers is to have their lives turned upside down in the form of job losses, court battles, and personal debt.

Ernest Fitzgerald and Henry Durham, Lockheed

Whistleblowers-Ernest-Fitzgerald-Lockheed — Ernest Fitzgerald ho blew the whistle on skyrocketing costs of the C5A cargo plane at the Air Force.

In 1968, Ernest Fitzgerald, a management-systems officer in the U.S. Air Force, raised concerns about a $2.3 billion cost overrun for the C-5 military aircraft. His complaint was supported by Lockheed employee Henry Durham, leading the two to testify before Congress about the matter.

President Nixon fired Fitzgerald, reportedly telling aides to “get rid of that son of a bitch.” Durham was threatened with demotion, but chose to be laid off instead in 1970. The incident, largely forgotten today, inspired other corporate workers to pick up the whistle in the following years.

Kermit Vandivier, B.F. Goodrich

Known as a tiremaker today, Goodrich produced airplane wheels and other parts in the 1960s. When a pilot nearly crashed because of a defective brake, Kermit Vandivier took the matter to the FBI and Congress. Goodrich fixed the brake, while Vandivier, who was supporting seven children, took a job as a local reporter.

Karen Silkwood, Kerr-McGee

Silkwood is one of the best-known whistleblowers in American history, thanks in part to the 1983 film that told her harrowing story. After joining an Oklahoma nuclear plant owned by Kerr-McGee, Silkwood discovered her body was contaminated with plutonium. She testified before the Atomic Energy Commission in 1974. As she prepared to go public with more evidence for her claims, she died under mysterious circumstances. On the evening she was to meet a New York Times reporter, she was found dead in her car.

In the following years, more nuclear-plant workers would blow the whistle on what they saw as unsafe conditions, notably the GE Three, a trio of engineers in San Jose who brought to light safety problems at General Electric nuclear plants. They later joined the growing anti-nuclear movement and testified before Congress.

Mark Whitacre, Archer Daniels Midland

In 1992, Whitacre alerted FBI agents to a price-fixing scheme at ADM for one of the grain giant’s feed additives. He agreed to act as a government informant, secretly recording conversations. The subsequent investigation revealed that Whitacre had been illegally taking millions of dollars from the company. The affair led to prison sentences for three former ADM executives, including Whitacre and the son of the company’s former chairman. It also inspired a 2009 film, The Informant!

Jeffrey Wigand, Brown & Williamson

In another scandal that found its way to celluloid (1999’s The Insider), Wigand appeared on 60 Minutes and said his firm, tobacco giant Brown & Williamson, had intentionally manipulated the level of nicotine in their cigarettes to addict smokers. “We’re a nicotine delivery business,” he famously said in the interview.

Wigand, who was sued for breaking a confidentiality agreement and claimed to have receive anonymous death threats, became a schoolteacher in Louisville. But his interview spurred 46 states to sue Big Tobacco, leading to a $246 million settlement.

Cynthia Cooper, WorldCom

Cooper was working as vice president of internal audits at telecom giant WorldCom when she discovered a $500 million accounting entry for computer expenses, with no supporting invoices. She and her team then worked secretly at night to eventually unearth $3.8 billion in fraudulent accounting entries.

Cooper would leave to start her own consulting firm, while the accounting scandal led to WorldCom’s bankruptcy, not to mention the loss of thousands of WorldCom jobs.

Sherron Watkins, Enron

In August 2001, Watkins was working as a corporate development executive at Enron when she wrote a letter to CEO Kenneth Lay warning of improper accounting that could “implode in a wave of accounting scandals.” While Watkins didn’t alert federal regulators or the press, her letter proved prescient and suggested Enron’s leaders knew of the fraud, but didn’t act.

Enron did implode, of course, spectacularly so. The energy giant filed for bankruptcy protection and sold off its assets, plunging the blue chip into penny-stock territory. Watkins became an author and speaker, and, along with Cooper, testified before Congress about their former companies’ scandals. The two were named Time’s “Persons of the Year” in 2002.

Cheryl Eckard, GlaxoSmithKline

In 2002, Eckard investigated manufacturing violations identified by the Food and Drug Administration at a GSK plan in Puerto Rico. She repeatedly complained to the company’s managers that the plant was a non-sterile environment, then took her evidence to the FDA. She was laid off months later.

Eight years later, GSK pleaded guilty to Department of Justice charges that it made adulterated drugs in the plant, paying a $750 million settlement. A court also awarded Eckard $96 million in damages in 2010. “It’s difficult to survive this financially, emotionally,” she said at the time. “It’s a very difficult process but very well worth it.”

Wells Fargo Whistleblowers

Bank managers and other Wells Fargo employees began complaining in 2010 about 2 million bank accounts and credit cards that customers never authorized. Six years later, the bank was hit with $185 million in combined fines, along with a separate $142 million class-action settlement. Wells Fargo has been through two CEOs since the scandal erupted (and just named a new boss on Friday), while some whistleblowers have taken their former employer to court.

Tyler Shulz, Theranos

Whistleblowers-Tyler Shultz-Theranos — Tyler Shultz was the first of many Theranos employees to blow the whistle.

Shulz emailed Theranos founder Elizabeth Holmes in 2014, complaining that the health-tech company had doctored research. He quit after receiving an insulting reply, becoming the first Theranos employee to blow the whistle on the company, contacting New York health officials and speaking to the Wall Street Journal.

Shulz has said he was pursued by Theranos lawyers and followed by private investigators. Last year, the Securities and Exchange Commission charged Holmes and Theranos with “an elaborate, years-long fraud” that raised $700 million from unwitting investors. Theranos was later dissolved, and Holmes indicted on wire fraud. Her trial is slated for next year.

Susan Fowler, Uber

In short order, Uber went from a darling of Silicon Valley to a scandal-plagued pariah. The tipping point came from a blog post from Fowler, who wrote that she had been routinely sexually harassed at the company. When she took her complaint to upper management, she was told they “wouldn’t feel comfortable punishing him.“

Fowler’s whistle was heard far and wide. Others stepped forward to complain about harassment, spurring a #deleteuber movment that led to founder Travis Kalanick’s ouster. A humbler Uber went public in May. Today, it’s trading 30% below its $45 a share offering price. Fowler now edits op-eds at the New York Times.