OSHA Fines SpongeTech Delivery Systems $32K in Whistleblower Case
Jaclyn Jaeger
June 20 2014
The Occupational Safety and Health Administration this week ordered SpongeTech Delivery Systems to pay $31,835.33 in back wages to a former employee for violating the whistleblower provisions of the Sarbanes-Oxley Act. According to OSHA, the cleaning product company violated Sarbanes-Oxley by blacklisting the former employee after she reported alleged investment fraud to her superiors. “The point here is sharp and important: no employee should be fired or otherwise penalized for reporting investor fraud," Robert Kulick, OSHA's regional administrator in New York, said in a statement.
The alleged wrongdoing came to light in 2009, when the employee was in the Netherlands representing SpongeTech Delivery Systems in a trade show. Despite representations made to the contrary, the employee discovered that the company didn't have any sales in Europe, and communicated these concerns to company officials.
During this time, SpongeTech also was under investigation by the Securities and Exchange Commission for publicizing fictitious sales and product orders for the purpose of selling stock. In 2010, shortly after the employee brought the alleged misconduct to the attention of her superiors, the company terminated her employment. She consequently filed a whistleblower complaint with OSHA.
Both the company and the whistleblower have 30 days from receipt of OSHA's finding to file an appeal with the department's Office of Administrative Law Judges.
Michael Metter, the company's chief executive officer, and Steven Moskowitz, its chief operating officer, plead guilty in January 2013 and August 2011, respectively, to criminal charges related to the investor fraud that led to the employee's termination. |
