The federal law designed to shield whistleblowers from retaliation has given scant protection to workers in the six years since it was written into the Sarbanes-Oxley Act (SOX), legal experts claim and Department of Labor (DOL) statistics confirm. Moreover, it appears the odds are getting worse, with recent actions exposing loopholes so big that Enron-scale fraud, or auction-rate securities malfeasance, could slither through. "The law obviously has not worked," says attorney D. Bruce Shine.

As evidence, he points to a recent court decision that snatched away protection previously awarded his client, and a new DOL interpretation of the statue that limits its scope to publicly-traded companies, not their privately-held subsidiaries.

In the first instance, a federal appeals court ruled that David Welch, former CFO of a Cardinal Bankshares Corp. unit–and the very first person promised protection under the SOX stipulation–wasn't entitled to return to his previous job at the Bank of Floyd in Arkansas. The three-judge panel ruled that Welch, now an accounting professor at Franklin University in Columbus, Ohio, failed to prove that the bank committed fraud by overstating its earnings by $195,000.