David Welch was the CFO of Cardinal Bancshares, and the first person to file a claim for whistleblower protection under Sarbanes-Oxley Section 806.
The Department of Labor ruled in his favor in regards to reinstatement to his job. But Cardinal refused to reinstate him and appealed to the highest level, and Welch’s case was ruled to have no merit.
Welch says that he raised concerns about the company’s accounting policies and internal controls, and then refused to certify Cardinal’s financial results. He says he was fired for this, but the bank says that he was fired instead because he refused to meet with an independent auditor and company lawyer without his own lawyer present.
The appeals board ruled that as the head of finance at Cardinal and as a CPA, Welch “could not have reasonably believed that Cardinal misstated its financial condition,” and therefore didn’t deserve protection under Sarbanes-Oxley.
