CPA Tim Hungerford of Hungerford Vinton, LLC talked about the whistleblower. His firm specializes in forensic accounting and specialized auditing.
Hungerford said 45 percent of all fraud cases are exposed by tips. Protection for whistleblowers, employees who reveal fraud within their company, has improved with the passage of the Dodd-Frank Act. The law includes the right to report fraud without fear of discharge, demotion, suspension, harassment or discrimination.
Whistleblowers are aided by the presence of an ombudsman, an official usually appointed by a company who is charged with representing the interest of the employees by investigating and addressing complaints or violation of rights.
Hungerford said small businesses are particularly vulnerable to fraud. These organizations typically have fewer resources for employees, but he noted it's important that any employee feel comfortable disclosing fraudulant activity.