In a late-August decision with potentially far-reaching implications for foreign and multinational employers, the U.S. Department of Labor Administrative Review Board (ARB), held that SOX’s whistleblower provisions have extraterritorial application—in apparent contradiction of appellate court and indeed prior ARB case law.
In Blanchard v. Exelis Systems, ARB Case No. 15-031, ALJ Case No. 2014-SOX-020 (Aug. 29, 2017), the respondent had a contract with the U.S. Department of Defense (DOD) at Bagram Air Force Base (Bagram) in Afghanistan. Blanchard was a security supervisor. His duties included assessment of Afghanis and “other country nationals” (OCNs) who sought access into Bagram. Blanchard claimed that his supervisors engaged in violation of DOD security policy and mail and wire fraud by attempting to cover up the fact that another employee had allowed an OCN to enter Bagram without proper credentials, because they were concerned that the security breach would reflect badly upon the contractors.
