Home -> Law Blog Directory -> Corporate & Securities Law Blogs -> inside Sarbanes Oxley

Corporate & Securities Law

: inside Sarbanes Oxley

Ignore a Whistleblower ? at Your Peril

By Toby Lucich

A financial scandal at biotech company Dyadic International offers a telling lesson about how whistleblower memos can come back to haunt the executives who ignore them.

Dyadic's internal dirty laundry first came to light at the company last April, when then-CFO Wayne Moor went to the company's Asian subsidiary to pick up the pieces after the unexpected death of an executive. While there, he learned of accusations about tax fraud and kickbacks that had been made against other executives ? allegations that a whistleblower had first presented in late 2003 and 2004 to founder and CEO Mark Emalfarb.

By the end of the month, Emalfarb took a leave of absence after the company realized that he had not shared with others at the company the initial emails that had been sent to him four years ago, alleging impropriety. Emalfarb was fired in September, and Moor has since taken his place as CEO.

Ignore a Whistleblower ? at Your Peril

Full post as published by inside Sarbanes Oxley on March 05, 2008 (boomark / email).