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Tales from a whistleblower

Cynthia Cooper never meant to appear on the cover of Time as one of “The Whistleblowers” whom the magazine named Persons of the Year for 2002.

Cooper was simply an auditor, wife and mother living a private life in rural Mississippi when she uncovered $3.8 billion in fraud at WorldCom and found herself at a moral crossroads: to report or not to report? 

“Fraud can be a very slippery slope, and people go down that slope one step at a time,” Cooper told students this week.

Ultimately, Cooper decided to eschew mounting pressure from her superiors and report the fraud. In the end, it was worth it.

“When I lay down my head at night, I can sleep well,” Cooper said. “I did it because I thought it was the right thing to do.”

Cooper spoke with students about her journey from private auditor to public whistleblower and the ethical decisions she faced along the way. Her talk was part of the Class of 1961 Ethics Series “Exploring Ethics in Your World.” This session, cosponsored by the College of Business and Economics, was the second of three presentations.

Summoning moral courage

After Cooper’s discovery, WorldCom filed the largest Chapter 11 bankruptcy in history. The Securities and Exchange Commission conducted an investigation and estimated that WorldCom’s total assets had been inflated by about $11 billion. Several top company officials were convicted or pleaded guilty to charges of fraud and conspiracy.

Cooper told students about the moment she first knew something was awry.

“There was a $2 billion entry in capital expenditures, and I was told it was ‘prepaid capacity.’ I didn’t know what that was, but when I looked into it, they had cut my account access. What started out as curiosity turned into a growing feeling of suspicion.”

Like many of her colleagues, Cooper learned that WorldCom was cooking the books. But it took moral courage to do something about it.  

“I wasn’t always a pillar of strength,” she said. “My hands were shaking and I was filled with fear. But courage is acting in the face of fear. Prepare yourself to summon that courage before you get to that moral crossroads.”

Cooper faced an uphill battle after blowing the whistle but never regretted her decision. She now speaks to colleges and businesses and recently wrote a book, Extraordinary Circumstances, chronicling her plight.

“It’s so important to share this story with the next generation of leaders,” Cooper said. “We want to make sure the moral fabric of our country is strong and that this kind of thing doesn’t happen again.”

Pete Hagerman ’61, who spearheaded the Endowment Fund for the Teaching of Ethical Decision-Making, said ethics are an important part of a Lehigh education.

“With this endowment, we want to capitalize on the ethics education that already exists at Lehigh,” Hagerman said. “Students are going to face all sorts of ethical decisions in the business world, and our capitalistic system may not be able to survive if they don’t come armed with the right tools.”

Joseph Manzo, professor of practice in the accounting department, said it’s essential to teach business ethics at the undergraduate and graduate level.

“The best way to successfully deal with ethical dilemmas is to know what is possible,” Manzo said. “If students are not aware of the ethical dilemmas they could potentially face in the business world, they run the risk of getting trapped in decisions that are unethical. It’s important for students to hear from speakers like Cynthia.”

 

 
Posted on Friday, April 13, 2012
 
 
Cooper and Pete Hagerman ’61, who led the efforts to establish the Endowment Fund for the Teaching of Ethical Decision-Making.
 
“Courage is acting in the face of fear. Prepare yourself to summon courage before you get to a moral crossroads.”—Cynthia Cooper
 
Cooper and Joe Manzo, professor of practice in the accounting department. Manzo says students need to be aware of the ethical dilemmas they might face in the business world.
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