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Whistleblowers at the SEC Office of the Inspector General Allege Retaliation

Posted  November 13, 2017

By the C|C Whistleblower Lawyer Team

The Wall Street Journal reports on employees within the SEC inspector general’s office alleging retaliation for pointing out misconduct within the office. At least two employees who work for Carl Hoecker, the current Inspector General at the SEC, filed complaints with different federal whistleblower agencies. The complaints allege that the whistleblower employees brought forth information of potential time and attendance fraud by a supervisor and subordinate within the IG’s office. Allegedly the two employees at issue regularly disappeared together for several hours during workdays.

The whistleblowers allege that after they brought their complaints forward, Mr. Hoecker and other senior staff retaliated against the whistleblowers but there is no mention of how this retaliation occurred. The SEC IG’s office escalated the whistleblower’s complaints to a federal prosecutor who declined to pursue the case. The SEC IG’s office conducted its own internal investigation and concluded that the supervisor at issue “created the appearance” of an inappropriate relationship with his subordinate and the matter was handled through a remediation plan.

The whistleblowers expressed concern with how Mr. Hoecker handled the complaints. They argue that Inspectors General are supposed to encourage whistleblowing but that the office’s internal investigation was not independent. For example, the whistleblowers argue that having one of the investigators be a senior employee who hired and supervised the employees at the center of the complaint tainted the investigation. Furthermore, the whistleblowers took issue with Mr. Hoecker calling the commissioners of the SEC his “bosses” when the SEC IG’s office is by law an independent entity.

The Council of the Inspectors General on Integrity and Efficiency reviewed the whistleblowers’ allegations earlier this year and decided not to take any action. Mr. Hoecker is the chairman of the council. For its part the SEC IG’s office issued a statement saying “a number of the claims contain significant factual inaccuracies, while others are grossly misleading.” The whistleblowers brought their claims to Senator Charles Grassley and it remains to be seen what action will be taken in response to their claims.

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