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Protecting Whistleblowers since 1977

Whistleblower Protection Petition to Treasury Delivered as Geithner Testifies on MDBs

Shelley Walden, April 05, 2012

Shelley7.1Last week, GAP delivered copies of our joint petition, Protect Whistleblowers at U.S. Taxpayer-Funded International Banks, to key officials at the Treasury Department and in Congress, in conjunction with Treasury Secretary Tim Geithner’s testimonybefore the House Committee on Appropriations (State, Foreign Operations and Related Programs Subcommittee). This joint petition was produced with coalition partner National Taxpayers Union. Thank you to the more than 500 supporters who signed the petition!

Geithner was slated to testify about the reforms required by Congress as part of the U.S. contribution to the General Capital Increases at the Multilateral Development Banks (MDBs). Unfortunately, Geithner failed to mention whistleblowers once in his testimony, despite the fact that the U.S. Consolidated Appropriations Act, 2012 requires the Treasury Department to report whether the World Bank, African Development Bank and Inter-American Development Bank are making "substantial progress" toward "implementing" best practices for the protection of whistleblowers from retaliation before the U.S. can contribute tens of billions of dollars in cold cash and guarantees to bailout these institutions.

The Treasury Department recently released its report to Congress and unfortunately, it is not responsive to the whistleblower protection requirements in this legislation. Given that Congress is on the verge of contributing billions of dollars to the MDBs, one would think that Congress would have spent part of the hearing evaluating Treasury’s report and determining whether the MDBs have complied with the reforms required. As sometimes happens, much of the hearing was devoted to unrelated issues.

Representative Congressman Mario Diaz-Balart of Florida’s questions were particularly colorful. Rather than hold Treasury accountable for shortcomings in its report to Congress, Diaz-Balart focused on the administration’s questionable implementation of the People-to-People program, designed to help promote the Cuban peoples’ independence from Cuban authorities. Diaz-Balart quoted tourism language from websites of organizations that were provided People-To-People licenses under the Treasury Department’s watch and criticized Treasury’s implementation of the program:

You have said that…the law prohibits tourism and yet you have all these references that I just read about tourism, about ‘shake your booty,’ about bring your sunscreen. Do you not consider those things being tourism?” (minute 43:30)

Geithner insisted he was just “applying the law as it has been written.” Diaz-Balart reminded him “when you and I talked last year you committed to me that you would not accept those that were tourism. These clearly are … I’m opposed to you not following your own guidelines.” (minutes 42-44:30) (Emphasis added)

But despite this evidence, Geithner continued to insist “I’m very confident we’re carefully following the law.”(44:25)

Really? By that logic, we can all help promote the independence of the Cuban people by slapping on our sunscreen and shaking our booties at jazz clubs in Havana.

While this exchange may have focused on Cuba, a similar exchange could have easily occurred about whistleblower protections. Similar to his promise about the People-To-People Program, Geithner promised Congress last year that the Treasury Department would exact from the MDBs the “best standards for internal controls that we can.” But did this happen? Subcommittee Chair Kay Granger wanted to find out and asked Geithner if he could “assure the Subcommittee that the reforms are being executed and there’s no back tracking by these institutions.” (1:04:35)

Geithner claimed that the MDBs “are making progress and we’re going to continue to hold them to those commitments.” (1:05:05)

In GAP’s view, this is inaccurate. The reality is that Treasury’s initial report to Congress fails to reflect the “progress” of the MDBs on the implementation of whistleblower protection policies adequately. The relevant section of Treasury’s report not only confines the analysis to what the policies say rather than how they are implemented, it also misrepresents the policies’ actual content.

Since Geithner testified last year, no progress on whistleblower protections has been made at the World Bank or the African Development Bank. And the Inter-American Development Bank, which has indicated that it will revise its whistleblower protection policy, still fails to meet the requirements established in U.S. law and has a series of whistleblower retaliation claims pending before its Administrative Tribunal.

Geithner’s Treasury Department clearly hasn’t lived up to its promises to Congress – in more than one area. Let’s hope that Congress holds the Department accountable to its commitment to “keep on this and make sure over time – not just initially … these reforms have broader traction and they hold to them.” (1:06:45)


Shelley Walden is International Officer for the Government Accountability Project, the nation's leading whistleblower protection and advocacy organization.