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Governments, Corporations Warm Up to ‘Tattler’ Lines

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TIMES STAFF WRITER

A prison superintendent in New Jersey was turned in for selling parole to inmates. A California Department of Forestry employee was discovered spending afternoons at a bar, and a Los Angeles County social service worker was investigated after taking a gun to the office.

At Litton Guidance and Control Systems in Northridge, employees have been informed on for smoking in non-designated areas, and Great Western Bank in Chatsworth got word of an employee who approved a loan for a relative.

The offenders weren’t detected by police, but by peers or members of the public who simply picked up a phone, dialed a toll-free 800 number, and anonymously reported the misdeeds to a hot line designed to combat fraud and other misconduct.

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Although several lines have been operating around the country for more than a decade to root out welfare fraud, so-called “tattler” lines are increasingly viewed by both public agencies and private corporations as an effective way to regulate behavior.

From petty misdeeds to potential prosecutions, the “crimes” are reported to either a simple answering machine or a live telephone operator backed by an investigative fraud team. Advocates say the popularity of hot lines proves they have tapped into a human desire to right a wrong--or sometimes, to clandestinely seek revenge.

“It used to be a standing joke that government and corporate ethics lines were an oxymoron, or people would refer to them as 1-800-RATFINK,” said Michael Hoffman, executive director of the Center for Business Ethics at Bentley College in Waltham, Mass.

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“But now, there is much more acceptance on the part of employees who see that fraud can be harmful to everyone, and also by employers, who realize that saving money is good business,” said Hoffman, who has advised corporations that are installing lines.

Though Los Angeles County keeps no records on savings, a recently released report says that a 7-year-old employee-fraud line has netted more than 4,500 calls, which in turn led to 148 firings and 457 suspensions, reprimands or other punishment.

In the San Fernando Valley, corporations ranging from Anheuser-Busch to the aerospace giant Lockheed have also installed the lines, usually with success, according to the companies. In some cases, simply having a hot line is as useful as following up the tips they collect.

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“The fact of the matter is that deterrence is a big part of the success of these lines,” said Steve Nylander, who oversees a hot line at Calabasas-based Lockheed Corp.

Not everyone, however, sees the popularity of the lines as an encouraging trend.

“It has a chilling effect on the workplace,” said Dan Savage, special assistant to the general manager of Local 660, of the Service Employees Industrial Union, which represents more than half of the 80,000 people employed by the county. “The problem with these hot lines is the credibility of the people calling. If you’re mad at somebody, you can just call in and make something up. It’s a way to mess with people.”

Nonetheless, the lines are popping up everywhere, from New York City, where retired police officers have set up a corruption hot line, to the Antelope Valley, where school administrators are paying students for tips on graffiti, drugs and guns. So far, that program has led to at least 38 arrests. A similar plan is being discussed in the Los Angeles Unified School District.

Still other hot lines are operated by the Pentagon, most major defense contractors, including Northrop Grumman and Hughes Aircraft, Texas Instruments, Dunn & Bradstreet and the California State Bar Assn.

For many government agencies, the creation of the lines has been spurred by public outcry over the misuse of tax money. But once set up, the lines often become a link between government and the public for more than just hot tips.

After she was sworn in last January, for example, one of Kathleen Connell’s first acts as state controller was to install a fraud hot line for her agency.

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“When I was running, people told me they felt disinvolved in government, they’re upset, angry,” Connell said. “What this does is validates their concerns.”

In fact, public officials say many callers are actually complaining about government in general, venting personal anger, or asking questions on everything from how to file tax returns to how to get to the Lincoln Memorial.

In the private sector, many businesses have set up lines in response to 1992 federal legislation that increased the fines government contractors could face if found guilty of fraud. A business can reduce its fine if it can prove that it took steps to fight fraud by, for instance, hiring ethics advisers or setting up tip lines.

“That’s probably the biggest reason they’ve taken off,” said Richard Elslager, a vice president for Encino-based Pinkerton Security and Investigation Service, which contracts with corporations to run their fraud lines. Business, he said, has tripled in the past two years.

At Northrop Grumman, Vice President Shirley Peterson said the Los Angeles-based aerospace company receives about 1,200 mostly anonymous calls each year from its employees. Only about one-quarter of the calls are allegations of wrongdoing, she said; the rest are questions about company rules.

Because of the nature of the company’s work, Peterson said, calls about seemingly minor infractions--skipping out of work early, for instance--are treated as serious offenses.

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“If people are not being truthful on a time card, then we really don’t have a clear idea about how many hours are needed to finish a project,” she said. “That could lead to an overcharge on a contract.”

But it is government that operates the busiest hot lines, and reports recently issued by the state and county offer a glimpse into the variety of offenses that surface.

According to the Los Angeles County report, most of the violations from October to December, 1994, involved employees who came in late, left early or stretched 15-minute breaks into leisurely siestas. And one employee was reprimanded for calling in sick when he was actually moonlighting.

But the calls also led to one conviction, two arrests, three resignations and six suspensions, according to the report. In all, employees in 14 county departments were found to have violated one rule or another.

In one of the most serious offenses, a county employee was caught trying to cash counterfeit checks from the Community Development Commission. County officials refused to disclose more information about this incident and others mentioned in the report, citing the need to protect tipsters from public exposure.

The line collected more than 100 mostly anonymous tips during that three-month period, 83 of which resulted in new investigations by county auditors, said Ian Clark, who runs the hot line from an obscure, basement office.

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Meanwhile, the state auditor’s hot line collected 2,061 calls from last August through December, though about 64% of those were requests for information or other issues outside the auditor’s jurisdiction.

The state opened 71 investigations as a result, it reported. In a typical year, the line gets between 3,500 and 5,000 calls, prompting about 200 investigations, said Kurt Sjoberg, state auditor.

Although the tip line once enabled the state to recover $3.9 million in a MediCal billing error, most recent reports of misconduct amassed by the state and county have been comparatively modest. For example:

* In Los Angeles County, a Health Department worker was fired for soliciting cash payments from patients, and a welfare worker resigned after borrowing money from a client.

* A county librarian, caught with 42 overdue books and other materials, was suspended for 30 days.

* A county Planning Department employee slipped a proposal from his own consulting firm into a bid package for a government project he was handling. His punishment is pending.

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* A Caltrans highway engineer drove a state vehicle to a card room and gambled on state time. He has not yet been punished.

* Another Caltrans employee, who moonlights as a contractor, remodeled a ski lodge on state time, though he billed the ski lodge $45 per hour for his services. He has not yet been punished.

Just as Los Angeles County omitted details, the state auditor’s report kept its examples deliberately vague because of an overriding concern that the tipster’s identity might be revealed if too much about the reported offense becomes known, officials said. The fear of exposure is so great that culprits’ names and often even their gender were left out in both the county and state reports.

In fact, anonymity is widely acknowledged as the reason hot lines work. If informers are exposed, the results can be devastating, as one Los Angeles city worker discovered in the mid-1980s.

Robert J. O’Neill won $800,000 from the city for emotional distress, defamation of character and invasion of privacy after a memo detailing his juvenile crime record was circulated at City Hall. The memo surfaced after O’Neill had complained of mismanagement by his boss, Sylvia Cunliffe, to a city fraud line. Both employees ultimately resigned.

Despite recent efforts to protect tipsters, hot line operators are nonetheless aggressive in pursuing complaints. In Los Angeles County, Clark said, his staff of five is not above taking covert pictures and videotape, or rifling through trash.

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Yet, so far, the hot lines have engendered little public opposition from workers, who say they regard them as inconsequential.

“If you’re not doing anything wrong, you don’t think about it,” said one county employee who asked not to be named. “And most people are honest.”

Tips without merit--the product of a jealous co-worker, for example--are simply dropped, hot line managers say.

“We’re not out to get someone,” said Guy Zelenski, a senior county auditor. “If there’s something there, there’s something there. If not, we go on.”

The benefits seem to outstrip the problems in the public’s mind--and that’s what counts, private and government hot line investigators say.

The state auditor’s line, for example, costs between $250,000 and $750,000 to run each year, depending on budget restraints and the number of claims investigated. But it has led to the recovery of hundreds of thousands of dollars at a time, Sjoberg said.

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And though some rank-and-file employees cringe at the thought of Big Brother, they have been able to use hot lines to their own advantage.

One state worker hung a poster for the hot line near her desk “to let the boss know she was not going to stand for anything wrong,” Sjoberg said.

And one county health worker turned in the boss “for verbally abusing her subordinates,” according to the county report.

Others grudgingly give the fraud line its due for more serious reasons.

“If they had had one of these down in Orange County, maybe they wouldn’t be in the mess they’re in today,” said one Los Angeles County employee, who, naturally, wished to remain anonymous.

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