Commentary: Whistle-blowers are a hidden cost in Sarb-Ox

08/23/2007 | Wall Street Journal, The

Besides the high cost of compliance, the five-year-old Sarbanes-Oxley Act is burdening companies in another way, Michael Delikat, a lawyer with Orrick, Herrington & Sutcliffe and an author, writes in a Wall Street Journal commentary. Congress is considering offering even more protections to whistle-blowers under the act, a move that would further burden companies by forcing them to respond to complaints from employees who, in many cases, simply have an axe to grind. "Critics also overlook the simple fact that the statute's whistle-blower provisions just may have accomplished its intended purpose. Since Sarb-Ox, most public companies have created procedures for the receipt and review of even anonymous complaints of accounting or securities fraud," he said.

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