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Cardinal Refuses to Reinstate CFO

Cardinal Refuses to Reinstate CFO

by Rick Turoczy on June 28, 2006

In a widely watched whistleblower case, Cardinal Bankshares yesterday decided once again to refuse a Department of Labor judge’s recommended order to reinstate the bank’s former CFO, David Welch, the company’s outside attorney Laura Effel told Instead, the bank holding company plans to wait and see whether the DoL or Welch brings an action against the company in U.S. District Court, she noted.

Welch was fired from Cardinal in October 2002 for refusing to speak with the bank’s audit committee without his personal attorney present. Welch’s lawyer, Bruce Shine, said the finance chief believed that the bank was preparing to fire him for disclosing improper accounting practices during internal meetings. Thus, Welch refused to meet with the audit committee without legal representation, Shine added.

Welch is said to be the first person to go to trial under the whistleblower protection provision of the Sarbanes-Oxley Act of 2002.

Cardinal Refuses to Reinstate CFO

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