The Astros Cheating Scandal and Compliance – Part 5: The Whistleblower and The Amnesty

Thomas Fox - Compliance Evangelist

Compliance Evangelist

I am nearing the end of a multi-part exploration of the Major League Baseball (MLB) investigation into allegations that the Houston Astros engaged in a multi-year scheme to steal signs and signals from opposing teams. MLB issued a Statement of the Commissioner (MLB Report) detailing the investigation protocol, findings, disciplinary actions taken and conclusions. The entire sordid affair provides every compliance practitioner with multiple lessons to be learned that they can use in every corporate compliance program. In Part 4, I considered some of the ethical issues.  Today, I want to take a look at the whistleblower and amnesty afforded to the players who participated in the investigation.

The Whistleblower

This matter began in November 2019 when a former Houston Astros pitcher, Mike Fiers, gave an interview to The Athletic which detailed publicly for the first time the electronic sign stealing scheme that the Astros employed in 2017 during their historic World Series run. This article led MLB Commissioner Rob Manfred to order the MLB Department of Investigations (“DOI”) to conduct an investigation. The investigation covered the period from 2016 through to the present and involved the MLB interviewing 68 witnesses, including 23 current and former Astros players. The players were given amnesty if they stepped forwarded and were truthful in the interview process. No players were disciplined by Manfred. Significantly, the investigation was completed in less than two months.

One of the more troubling aspects of this matter has been the backlash against Fiers. Bob Nightengale, writing in USA Today, said, “The sentiment by former players, coaches and managers perhaps is not shared by the current rank and file, but they are more outraged and frustrated by Oakland Athletics pitcher Mike Fiers – baseball’s most famous whistleblower since Jose Canseco – than the actual exposure of the Houston Astros’ cheating scam.”

Indeed, this sentiment was most eloquently expressed by a former gold medal winning softball player, color commentator of ESPN’s Sunday Night Baseball and also Special Advisor to the New York Mets (I cannot explain how they got past that conflict of interest), Jessica Mendoza. Chris Bumbaca, writing in USA Today, reported that Mendoza, appearing on ESPN’s Golic & Wingo, said she disagreed with Fiers going public. Mendoza said, “To go public, yeah, that didn’t sit well with me. Honestly, it made me sad for the sport, that that’s how this all got found out,” Mendoza said. “This wasn’t something that MLB naturally investigated, or that even other teams complained about … but that it came from within…” She was further quoted for the following, “But to go public with it and call them out and start all of this? It’s tough to swallow.”

So here you have the complete trifecta, former player (albeit softball player), representative of the New York Mets and representative of the premier sports network in the world saying that someone stepping up, raising their hand and publicly speaking up on unethical conduct and conduct of baseball rules is “tough to swallow”. Jimmy Traina, writing in, said, “What a double whammy. First, she blames Fiers for exposing the cheating, and then she’s doing it as a member of a Major League team’s front office. It’s amazing that ESPN would even put her in this position and cause her credibility to take a big hit with viewers, but here we are. Your lead Sunday Night Baseball analyst just went on your network and said Fiers should’ve told some people, but not all people about the cheating. Great take.” Mendoza later backtracked from this statement somewhat, only saying Fiers was right to speak up, just not publicly.

If Fiers had not spoken up publicly, would any of the investigation or its continued fallout have occurred? More than one person has asked that question, most notably Bruce Jenkins, writing in the Houston Chronicle. He said, “How relevant was Fiers’ admission? Commissioner Rob Manfred released a nine-page statement explaining the initial sanctions, his stance on the matter and how information was obtained. It began, “On November 12, 2019, former Houston Astros player Mike Fiers publicly alleged …” It makes one wonder: If Fiers hadn’t spoken up, would any of this mess exist?” He went on to note, “In the eyes of many, Fiers violated a fundamental tenet of the ballplayers’ code, best expressed by a sign posted in a number of big-league clubhouses: “What you see here, what you hear here, what you say here, let it stay here. Tim Flannery was among those offended. “There are better ways to do it,” the Giants’ former third-base coach said. “If you’re gonna come out and cost people jobs and careers, and you’re feeling so bad about it, then give back your World Series share.”

It appears that baseball has some serious culture issues itself to work on going forward.

The Amnesty

Another issue which has garnered significant discussion is the amnesty given to the players. The players were apparently told that if you came in, sat for an interview and told the truth, no punishment would be delivered (i.e. amnesty). No players were disciplined by Manfred. However, this has not sat well with all. Christopher L. Gasper, writing in, said, “But for the sign-stealing escapades to stop, players need to feel the pinch and the pain too. Or this is just empty posturing, the equivalent of airport security theater. Thus far, Manfred has let the primary perpetrators off without punishment. What kind of message does that send, especially when the players are the ones who stand to benefit the most from sign-stealing? If Manfred really wants to root out information-age cheating, he has to flog the players too and create a deterrent for crossing the line that they can’t ignore.”

It is clear that Manfred made a tradeoff. He was willing to amnesty the players to get as much truthful information as he could. When he started the investigation, neither he nor MLB were sure how big the problem was or would turn out to be. As I noted yesterday, when you change the truth of the game through cheating, it can cause an existential crisis. This may have influenced Manfred’s thinking. Another thing which could have influenced his thinking was the fact that the players have not only a Collective Bargaining Agreement with a disciplinary review process but also a Union which stands behind them. If Manfred required baseball players to testify and then disciplined them based upon their own testimony, he could well have had a huge fight on his hands with the player’s Union.

In the greater compliance world, there is precedence for this amnesty. During the Siemens AG Foreign Corrupt Practices Act (FCPA) internal investigation, the company faced a crisis in its investigation. Mike Esterl, writing in the Wall Street Journal (WSJ), said, “Corruption at Siemens was “systemic” in recent years, said Mr. Solmssen. “There was a cultural acceptance that this was the way to do business around the world.” Further, “many German employees initially were reluctant to act as informants because that evoked memories of the methods used by the Nazi and East German secret police in previous decades.” To overcome this, the company’s General Counsel put in place an amnesty program for all employees except 300 selected senior managers. The move “prompted about 110 employees to offer information about alleged wrongdoing, general counsel Peter Solmssen said in an interview.”

If Manfred had not offered the amnesty, he would not have achieved the level of cooperation that he did which allowed MLB to conclude the investigation in just two months and the MLB Report would not have been nearly as comprehensive and decisive.

Tomorrow, I will conclude with some final reflections on the matter.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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