ACFE award "Whistleblower of the year": Michael Woodford

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The Wall Street Journal Japan - March 1, 2012

Michael Woodford, the man who exposed a $1.5 billion loss-hiding scheme at Japan’s Olympus Corp. –- and was fired soon after — has been named “business person of the year” by publications from the Sunday Times  to The Independent.

Now he can add to those honors another: whistleblower of the year, courtesy of The Austin, Texas-based Association of Certified Fraud Examiners, whose house publication is Fraud Magazine.’

The ACFE gives its annual Cliff Robertson Sentinel Award –- as it’s officially called –- to people who expose corporate or governmental wrongdoing. Or, as the Association itself describes in a blurb, to “the unselfish heroes whom society has tarred as being ‘whistleblowers,’”‘ who are “our frontline of defense against wrongdoing.”

The award was named after an actor who exposed embezzlement at Columbia Pictures in the late 1970s, and was blacklisted for years, ACFE spokesman Scott Patterson explained in an email.

Previous winners include Pamela Davis, a hospital administrator who raised flags about corruption in contract-awarding that eventually led to the office of former Illinois Gov. Rod Blagojevich. (Mr. Blagojevich was last month sentenced to 14 years in prison for corruption.)

Last year’s award, given posthumously, was to William H. McMasters, the man who exposed the original Ponzi schemer, Charles Ponzi, back in 1920.

Whistleblowers, the ACFE notes, rarely get rewarded for their pains, and often suffer for them. That’s certainly the case for Mr. Woodford, a newly minted CEO who was fired from his position at the Japanese camera maker in October, after raising alarms about accounting irregularities that originated under his predecessors.

Mr. Woodford followed up by taking his complaints to police authorities and regulators in the U.K., U.S. and Japan, as well as to the media. Soon after, the company admitted its executives had orchestrated a 13-year coverup of more than $1.5 billion in losses.

The fact that he was right still hasn’t earned Mr. Woodford much love at his former employer or its allies. Mr. Woodford attempted to lead a proxy challenge to oust the directors who fired him, but gave up earlier this month after failing to drum up enough support from Japanese investors — many of them business partners of Olympus.

In an email, Mr. Woodford says he’s “delighted” with the ACFE’s award, but remains “preoccupied about the future of Olympus and hoping that there will be a recognition by all interested parties, on the need for an entirely new management untainted by the scandal which would allow the first stage in a recovery in the company’s reputation to take place.”

Original article on Control Capital website