Sacramento Bee

SACRAMENTO – Gov. Gray Davis has vetoed legislation to create a confidential state “whistleblower’s hotline” and to protect employees who refuse to participate in illegal activities at work.

In his veto message, Davis said he agreed with the bill’s focus but objected to provisions that would impose fines on executives who did not commit wrongful acts but failed to report them quickly.

“Our main focus should be on punishing wrongdoers and encouraging reporting of wrongdoing,” Davis said.

The Foundation for Taxpayer and Consumer Rights said SB 783 would have been one of the nation’s toughest corporate accountability laws.

“Corporate America was afraid of this legislation, and Gov. Davis gave into that fear,” said Carmen Balber, the group’s organizing director.