You are on page 1of 10

September 14, 2012 9:38 pm

The whistleblowers club
By Carola Hoyos

They faced down banks, hospitals and defence companies. Now they’re joining forces

©Gino Sprio


n a quiet spring evening in 1999, Eileen Chubb walked as casually as she could into the office of Isard House, the care home for the elderly in Bromley, Kent where she had been working for the past three years. Glancing over her shoulder, certain she was going to be caught, she picked a ring-binder folder off a high shelf and emptied it of about 70 sheets of medical records. She handed them to a fellow care worker, who climbed the rarely used back stairs to a photocopier. The machine was so basic it took an excruciating 70 times of opening and closing the lid to copy the evidence they both hoped would make their employer acknowledge the abuse of elderly and vulnerable patients in one of its units. The pair were running out of time. Chubb, who had reported the abusers to social services two weeks earlier, was aware that a manager was en route. Judging by the distance from the manager’s home and the light evening traffic, Chubb knew they had at best 10 minutes. “I was doing what I thought was right. At the time I didn’t even know what a whistleblower was,” says Chubb. “I got pushed over a line when I saw the shouting and the pushing. We told management and social services and no one made it stop,” she explains, adding that she felt she had a duty to act. Failing to do so when she knew it was happening would make her an accomplice.

allows for unlimited compensation and. a standard for other countries to emulate. or WBUK. whistleblowers often find themselves shunned by their employer. no good way of dying and there’s no good way of whistleblowing. stopped abuse.” But Chubb would learn the hard way what happens to whistleblowers who want to expose a secret that powerful people have an interest in keeping hidden. Federal laws reward whistleblowers who help the government claw back money lost through fraud.“That’s when I thought: if I get the medical records that show Edna – who was in her nineties and a sweet. WBUK is the UK’s first broad-support lobbying group set up by whistleblowers. Some contemplate suicide. More than $500m in fines has resulted from their campaigns. Between them. There is no good way of getting a divorce. But it has a whistleblowers’ ombudsman (appointed last month) and it outlaws victimisation of those who report infringements of particular statutes. and allow for others to share in fines levied by its regulators. It requires the whistleblower to be acting in the public interest. nurses and care workers. The US still has no general employment protection legislation. Even in the UK. health and safety measures. rather than on the problems they reveal. forced the revamp of hospitals and care homes. their homes. ignored by regulators and let down by a court system that concentrates on their employment experience. more than a decade after she first blew the whistle. sweet lady – is being given such high doses of anti-psychotic drugs that she lies comatose with her head on the table. I would be able to make it stop. To his left sits Peter Gardiner. helped to usher in new anti-bribery laws. British law focuses narrowly on the employment status of the whistleblower. police detectives. including environmental. where whistleblower protection laws are held up as some of the best. erudite. She is attending the third meeting of Whistleblowers UK. defence contractors. voids gagging clauses. in theory. leans back on an aluminium chair. room AG03 on the ground floor of City University’s College Building in north-east London is filled with an Olympic line-up. Many lose their wealth. Ian Foxley. This is why Chubb has come to London on a late-August morning. a tall. their reputations and their mental health. not on the whistleblower’s message. whistleblowers who go public rarely get to work again in the industry they expose. doctors. former army lieutenant colonel and the emerging group’s chairman. But unlike in the US. a nascent charity made up of whistleblowers as diverse as bankers. And regardless of how legitimate their case. The law specifically protecting whistleblowers in Britain came into force in 1999 and is integrated into the country’s employment laws. the people founding WBUK have saved lives. . their families. a 71-year-old entrepreneur who ran a successful London-based corporate travel business for 21 years. Their shared history as whistleblowers – both raised (separate) allegations of UK defence contractors bribing Saudi officials – has drawn them together as friends and confidants. For anyone who has followed British whistleblowing for the past decade.

angrily repeating his point as he leans over the table. the former Lloyds TSB bank executive. He is a “patient”. is a consultant psychotherapist and psychoanalyst who has agreed to help WBUK. Ian Taplin.” he says. to “the site of a plane crash where the survivors were just getting to grips with their own injuries and those of their fellow passengers”. After going to the press and the US financial regulator.Rounding out their corner of the conference table is Gavin MacFadyen. Nevertheless. still at the beginning of the arc. He believes that many of us survive by turning a blind eye to transgressions big and small – from the wrong person being promoted for the wrong reasons. But today. which eventually fined Wachovia. the room is more like the ward of a hospital. whose detective work at US bank Wachovia in 2006 eventually helped expose how Mexican drug cartels laundered millions of dollars through the bank’s accounts. whose allegations about unethical behaviour by two police officers ended her 25-year career in the police force. it took him another three years of being turned away by what seemed to him to be the entire banking industry. “I think everyone in this room at one time thought about ending it all. Chubb and a handful of others. Ian Foxley compared the very first meeting of the group. The anger. to banking executives who launder billions of dollars of drug money. It was he who suggested to the whistleblowers that they form a group at a seminar he ran last summer. Also among them are Kim Holt. hurt and frustration of their debate makes evident that WBUK also serves as a support mechanism for its participants. is still fighting for recognition of his allegations against the bank. David Morgan. Margaret Haywood. Gardiner. Woods’ situation improved. as are Foxley. as well as campaign for their shared cause. Beyond them sit about two dozen people whose lives. He is intrigued by the psychological burden of whistleblowing and by what society’s often . director of the UK’s Centre for Investigative Journalism. and Vivienne Yarham. Which side you belong to is determined by how far you have progressed along the arc of the life of a whistleblower. the paediatrician who blew the whistle on the chaos and skeletal staffing at the Haringey clinic where Baby Peter Connelly was examined (Baby P was given a clean bill of health two days before dying of injuries inflicted by his mother and her boyfriend). who helped the BBC expose abusive care within the NHS and was subsequently struck off the nursing register. He is one of the “doctors”. full of “doctors and patients”. legal counsel and psychological care to future whistleblowers. before he found a similar job just days before this meeting. like those of Foxley and Gardiner. Diagonally across from him sits Martin Woods. sitting diagonally opposite Foxley. wrapped up in the injustice of his own case. in March 2011. as Foxley puts it. have been transformed because they refused to look the other way. They have come together to create a network to offer advice. Woods’ journey started with much the same emotion as Taplin’s.

citing national interests. especially regarding the psychological effects of the backlash. They say the internal conflict they would unleash by looking the other way or capitulating. when the US fined BAE $400m and found the company guilty of lying about its dealings. Gardiner ended his lucrative contract with BAE because his lawyers had advised him a new UK anti-terrorism law with an antibribery clause meant he risked acting illegally by continuing.” Vindication would take another four years. his art.violent reaction to whistleblowers tells us about the health of the system. his pension and his family. Kim Holt. “But I think in a way I am quite cushioned. Gardiner went from having “the life of private jets and cars” and a six-bedroom house in St Albans. nor that corporations and even those in authority fight back – often viciously – against those trying to expose them.” says Morgan. adding that he told himself at the time: “This is the real world. He likens the whistleblower to the child in the tale of “The Emperor’s New Clothes”. “We survive and maintain our own security often by turning a blind eye. I have a husband. would dwarf any punishment the outside world could administer. ” His marriage broke up. that blinds us from . he adds. the paediatric consultant. They end up in poverty. The SFO initially investigated Gardiner himself. “That was the worst. Gardiner was struggling to make ends meet. Other people never get their careers back. I never lost my job and I have sort of been vindicated in the press. “My daughter was being bullied at school. But after halting the contract and “blowing the whistle” to the SFO. David Morgan is neither surprised that so many people turn a blind eye to fraud and abuse. Whistleblowers sometimes have no idea what they are getting themselves into. In 2004 he turned to the Serious Fraud Office (SFO) after halting his travel agency’s work as a concierge for Saudi officials. I worked cleaning churches. so softly that it is difficult to hear him.” he says. Nevertheless. “No one wants an individual who is being investigated. Those whistleblowers who refuse to succumb to pressure when employers attack them with accusations of ineptitude or mental instability.. while still believing in the truth of their case. whose expenses were being funded by UK defence contractor BAE. “I started doing cleaning jobs. she was seeing her mother being bullied to the point where she is becoming ill. his business. was unable to return to her job for several years after raising her concerns in 2006. to losing his home.. this is what it is all about. At the same time. I have money. appear to have one thing in common. the punishment can be brutal. and who resist the temptation to make it all go away by accepting settlements with gagging clauses. who get over their disbelief when police or regulators fail to take up their cause. I didn’t have any money any more . like the emperor’s.” she says. At around the time the SFO’s investigation into BAE was quashed by then prime minister Tony Blair. including those with a Saudi prince. “It is this kind of seeming authority.” he says. A whistleblower for many reasons goes against the flow and does not turn a blind eye.” Peter Gardiner was not as lucky as Holt.

He takes a great risk challenging a human desire for certainties in an uncertain world. a former quality control manager at GlaxoSmithKline. After discussing it with her family. One of the hottest topics among WBUK members is whether the group should lobby the UK government to follow the US’s lead in granting whistleblowers a share of fines that are levied with their help. Fear of ridicule and rejection are powerful disincentives. Paul Moore.” says Morgan. before truth is allowed to come to the fore or not. and offer a relatively uniform approach. They reason that it would reward the whistleblower. In the US. the British pharmaceuticals group. “The whistleblower requires guts. and. you might end up with people saying they are whistleblowers when they are not. The biggest reward for me would have been that we would have improved our service and prevented [the death of] Baby P.. The doctors.” But money already plays a big part in whistleblowing. was awarded $96m of a $750m criminal and civil settlement between US regulators and her former employer. But taking the money can come with serious drawbacks. there is a lively debate about how Britain’s legislation stacks up against that of the US. its laws cover anyone. The rewards can be substantial. once the Baby P scandal hit. and therefore has to endure being made to carry all the uncertainties him. regardless of who employs them. the reward for her silence was raised to £120. Not only is there a whistleblowing ombudsman. while also silencing those who see things differently. help under-staffed regulators do their job and generate greater interest in whistleblower cases from UK law firms.or herself. In 2010 Cheryl Eckard. who as head of group regulatory risk at Hbos says he warned its board that the company’s “sales culture was .000.000. she turned down both.” says Holt. whose executives had ignored and then tried to cover up her warnings of contamination problems at its drug factory in Puerto Rico.” . In the UK’s favour. which today see little upside. Many of the City.This week the US Internal Revenue Service awarded former UBS banker Bradley Birkenfeld $104m for revealing a tax evasion scheme that cost the US government billions of dollars. employees can be treated differently from state to state. Holt says she was first offered £80. “If you bring money into it.. Almost all the whistleblowers in the room were at some point offered money in return for keeping quiet. however. nurses and carers are more reticent. In the opinion of many whistleblowers.seeing things as they really are. Within the whistleblower community. adding with irony: “Of course we would never have known that we prevented it. the US is far ahead of the UK because it encourages serious whistleblowers and the lawyers who represent them. but the US’s varying and sometimes overlapping regulators have also shown a greater willingness to pursue companies for alleged wrongdoing. given that the current legal path in the UK usually leads through an employment tribunal where winning or compromising often involves a financial settlement with a non-disclosure clause.and industry-based whistleblowers like the idea of such payments.

while the hand of those who seek to cover up wrongdoing is strengthened. WBUK intends to be part of the debate and some of its members have already been asked to submit evidence to the Parliamentary Commission on Banking Standards. “By that stage my drinking had got to the point [where] I could drink a bottle of vodka in under two hours with no trouble at all. Another major issue yet to be resolved is where to find the money to allow WBUK to graduate from a place whistleblowers can go for a sympathetic chat to one that changes laws. possibly helping to avert the financial crisis. I felt useless. Today the whistleblowers are still hashing out their message. “How do you think you are going to do that? What are the weapons?” asks Foxley. And the weapons you use are effectively going to be the media.” he says. “You are in a war for hearts and minds and the soul of the country. because unlike many other charities. the former lieutenant colonel. adding that he felt like Judas when he decided to take the settlement after a lengthy battle to be heard. more people would have come forward. He believes that had the odds not been so strongly stacked against him and others in his position. “You have to factor in the emotional turmoil that makes it very difficult to discern things in a balanced way. . They even gag your wife! You simply cannot believe what state I was in.significantly out of balance with their systems and controls”.” Eventually. Every time a whistleblower is ignored or silenced.” Success will come when blowing the whistle on even the most sensitive transgressions becomes less risky than covering them up. That may not be so easy. it allowed him to use his experience to inform the debate on how to avoid another banking crisis.” he says. I felt suicidal. persuade the unpersuaded and deter the ones who would act against you. he made the decision to break his silence. accepted a settlement that included a gagging clause. By then it was too late to save Hbos. he says. Moore says he initially settled on the advice of his lawyers. The decision was far from easy and the aftermath a long way from comforting. the odds of someone breaking away from the group and speaking out are diminished. WBUK plans not to take donations from government organisations or companies. he thought his concerns would never be taken seriously. I felt schizophrenic in my soul. But the whistleblowers of the past decade are determined to ensure the next generation is better protected by stronger laws and the support of those who have gone before them. Imagine what that did to my family and children. The group also needs funding to help pay for whistleblowers’ legal and psychological support – and perhaps even the odd mortgage bill. Moore found strength in his faith and sobriety through Alcoholics Anonymous. after feeling rebuffed by the Hbos board and ignored by the FSA. but. After watching Lehman Brothers collapse in 2008. “Everything was gagged. You have to reassure your supporters. and because. describing how he slid women’s pads under his armpits to stop the profuse sweating triggered by stress.

. She says she got little help from managers even though she escalated it to more senior ©Gino Sprio executives.. “You know. Eileen Chubb ‘Before this happened. and Chubb has established Compassion in Care... having started whistleblower charities within their own sector that could eventually come under the umbrella of WBUK. I like what you are doing... where she failed to gain exposure for her cause. It was only when she eventually went to the media that the issue of alleged abuse at Isard House and other homes was brought to light.. medical care and other activities by Saudi officials.. which aims to help financial whistleblowers. Chubb did indeed manage to escape Isard House that evening with the photocopies she had hidden under a batch of towels in the bathroom until her shift was over... began to come to light.. She carried the notes with her from an employment tribunal to the high court... She took copied work documents to an employment tribunal and even to the high court... Peter Gardiner ‘There is a culture here in England of covering things up that are in the national interest’ In the 1990s BAE had a £60m fund for expenses related to travel. Peter Gardiner’s travel and concierge company took care of the Saudis’ ©Gino Sprio . Isard House has since been vacated of its elderly patients and their carers.” says Foxley.... You are a bunch of ballsy.... Holt’s Patients First advocates for openness and accountability within the NHS... It was only after she told her story and went to the press that the alleged abuse at Isard House..“Ideally I’d like to find a really philanthropic billionaire who says. brave people who just won’t lie down. when she noticed signs of abuse... a care home for the elderly... Moore is in the process of creating City Whistle..... The former care worker now carries out independent undercover inspections of problematic care homes up and down the country..... Some of the group already have some fundraising experience. and eventually the sorry state of a large portion of the UK’s privatised elder care system... Now I have no doubt that I do not live in a civilised culture’ Eileen Chubb was working at Isard House.... I thought I lived in a civilised culture.......... and is awaiting sale and possible demolition. ..... Carola Hoyos is the FT’s defence correspondent...... As Chubb and the others lay the foundations for WBUK....... but failed to gain exposure for her cause......

He broke his silence in 2008. Hbos. the blame seemed to be laid disproportionately on the Haringey locum who examined him. Gardiner handed the SFO many documents that suggested BAE could be bribing Saudi officials. including those made in regards to Saudi Arabia. not only are we . is now under criminal investigation by the SFO. hoping his story would help inform the debate on how to avoid another financial crisis. went to the brink of collapse.5m to Cayman Island bank accounts and bestowed lavish gifts of cars upon Saudi generals.needs and then expensed BAE for the cost. so Holt went to the media. Gardiner helped the US Department of Justice. a subsidiary of pan-European EADS. When Baby Peter Connelly died just over a year later. Others never get their careers back. which eventually fined BAE $400m after finding it had lied about payments. GPT Special Project Management. and this year Holt was able to return to work. “I am absolutely convinced that. meanwhile. Paul Moore ‘I am convinced that we are going to change the legislation and make a better world’ As head of group regulatory risk at Hbos. Moore was fired and won a settlement with a gagging clause after he took his employer to court. Ian Foxley ‘In Britain there is still the idea of the whistleblower as the school sneak – and you shouldn’t reward the school sneak you should debag him’ In early 2011 Ian Foxley handed the Serious Fraud Office a huge number of emails suggesting the defence contractor he worked ©Gino Sprio for had made questionable payments of at least £11.’ In 2006 Kim Holt and three other paediatric consultants warned Great Ormond Street Hospital that chaos and skeletal staffing at its Haringey clinic presented a “very high risk” to patients. though at a different clinic. The company. Kim Holt ‘I have sort of been vindicated. but Tony Blair quashed the investigation in 2006. In 2011 Whittington Hospital NHS Trust took over Haringey Children’s Services. Paul Moore says he warned the bank’s board and the Financial Services Authority in 2004 that his employer’s sales culture was out of balance with its ©Gino Sprio systems and controls. Holt ©Gino Sprio says she was bullied and blocked from returning to work after sick leave.

though after he attended its first meeting. And that is exactly what he did in 2006 when he noticed large sums of possible drug money coming into the bank from Mexican money exchanges. was keeping my sanity and . Her complaint was not taken seriously. but we will make a better world. Three years on I am lucky enough to still be surviving’ It was Martin Woods’ job to find out whether any of Wachovia Bank’s customers were using its accounts to launder illegally ©Gino Sprio made money. She was reinstated six months later after two public petitions. he took his evidence to US authorities. awarded her compensation and the constabulary apologised. causing much public outcry.going to change whistleblowing legislation. Vivienne Yarham ‘Words can never describe how I was made to feel.. he remains undecided whether he will join WBUK. and she was shunned and ostracised until she eventually resigned. the ©Gino Sprio regulator struck Haywood off the nursing register for violating patient confidentiality. An employment tribunal upheld her claim for constructive unfair dismissal. which in 2010 fined Wachovia $160m. When he had no luck raising the issue internally. Everything changed overnight from being regarded as a first-rate detective to someone they no longer wanted to be associated with’ In 2004 Vivienne Yarham raised allegations that two Suffolk police officers were putting others at risk by acting illegally and ©Gino Sprio unethically.. Martin Woods ‘My bonus for 2008 was that I hung on to my integrity.” he says. You may be interested in Blow the whistle and reap a web of rewards Obstacles remain in BAE flight path Diplomats intervene over graft complaints Harbour services: The berth of an industry . ending a 25-year career in the police force. Margaret Haywood ‘It broke my heart that the [Brighton hospital] carers were working still and I had my livelihood taken away from me’ Margaret Haywood helped the BBC uncover gross neglect of vulnerable and elderly patients at a Brighton hospital. But when the Panorama programme aired. my family together.

What You Will. Contact us if you wish to print more to distribute to others. London Merger plan puts BAE's special status at risk Hands-on approach HBOS banker's undoing Paddle steaming with the FT: Timothy West and Prunella Scales EADS/BAE Systems .html Print a single copy of this article for personal use. Apollo Theatre. © THE FINANCIAL TIMES LTD 2012 FT and ‘Financial Times’ are trademarks of The Financial Times Ltd. .show me the upside Broker cuts EADS on BAE merger talks A third quest for the holy grail of defence US defence groups reassess strategies Sainsbury rises on upbeat comments Western defence mergers inevitable Investors complain about lack of detail Nationalism may delay EADS-BAE's take-off BAE/EADS .weak leap forward US conditions critical to BEA-EADS deal Aerospace and defence: Tactical manoeuvres Beware the insider raiders Printed from: