A former chief financial officer for a small Virginia bank has been ordered back to work under the Sarbanes-Oxley Act's whistleblower protections.
But despite the ruling from the Department of Labor's Administrative Review Board, Floyd, Va.-based Cardinal Bankshares Corp. said it would wait until compelled by a court to bring former executive David Welch back. The ruling -- which denies a request from Cardinal to stay a judge's early order to take Welch back -- is just the latest in a battle that has now lasted well over three years.
In 2004, Welch became the first worker to win protection as a whistleblower under Sarbanes-Oxley Act. Welch was fired in late 2002 after refusing to certify his company's financial statements. He claims he was blocked from meeting with the audit committee and evidence was rigged to make him look incompetent. The bank claims it fired Welch when he refused to comply with the audit committee's direction to meet with its representatives without his personal attorney -- saying that an outside attorney would have violated the company's need for confidentiality.
According to the law, the bank is now supposed to reinstate Welch to his job on an interim basis, or offer him payment instead of reemployment, while the federal labor board considers the case in full. If the bank does not do so, enforcement of the order will be left in the hands of a federal district court.
Previously on WebCPA:
In Close Vote, Supremes Limit Whistleblower Suits (May 31, 2006)
SOX Whistleblower Protections Being Tested (April 25, 2006)
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access