“MetLife Pension-Benefits Executive to Retire,” The Wall Street Journal, February 27, 2018 B10. Senior executive in charge of the unit that misplaced 13,500 retirees retires.
The cost of not using information.
Monthly Archives: February 2018
Storage
Where does your vendor store your information? Whose laws apply?
“Justices to Hear Microsoft Case on Email Storage,” The Wall Street Journal, February 27, 2018 B4. Supreme Court to resolve whether a search warrant to a person in the US (Microsoft) can require that person to turn over materials of a non-US person stored outside this jurisdiction. At issue is the Stored Communications Act, passed in 1986, which gives some privacy protection to materials stored online.
This involves both questions of governance (does the US government get to control information stored in, say, France, if within the control of a party in the US? Even though France says the US can’t have it? Does the DOJ get to ignore laws passed by Congress?)) and questions of storage of information. Discovery rules in civil litigation go to things within your possession, custody, or control. Is there any doubt that Microsoft controls where this information is stored? Why would a search warrant be able to get less information than a litigant in a civil case? What happens if Microsoft wins? Who owns the information? Does ownership matter?
If the Court rules for Microsoft, is the issue back with Congress, to further define (or eliminate) our privacy rights?
Does the government need to obey our laws? Must Microsoft protect the rights of non-US citizens?
Filed under Access, Compliance, Controls, Corporation, Duty, Governance, Government, Information, Interconnections, Internal controls, IT, Ownership, Privacy, Protect assets, Security, Third parties
Shaking up GE
GE has had a tough year. Or two. So it’s making major changes in the Board.
“Embattled GE Reshapes Board,” The Wall Street Journal, February 27, 2018 B1. Several directors removed after stock dropped 45% in 2017. Eight directors retiring.
This this a reaction of their failure to govern? Or just a reaction to bad results? Will the new board act differently? Are the shareholders better protected? Or there cultural problems to be addressed, so the CEO doesn’t fly two jets?
Filed under Board, Corporation, Directors, Duty, Oversight, Shareholders, Uncategorized
Gaps
What happens when you have information, but don’t use it?
“‘I Know He’s Going to Explode,'” The Wall Street Journal, February 24, 2018 A1. The FBI and the Sheriff’s Department had received multiple notices in advance about the shooter at the school in Parkland who killed 17. And failed to act.
Does your company have adequate processes for identifying important information, and acting on it? Does important information get to the right people at the right time?
What’s that worth? Who pays the price when you get it wrong?
Access
Competition is a good thing. Isn’t it good that airlines are competing based on providing better access to your information?
“Firms Push Better In-Flight Web Access,” The Wall Street Journal, February 26, 2018 B4. Airlines and satellite providers team up to give passengers faster in-flight web service. Cost to be included in flight cost.
Oh, great. Cellphone calls at 35,000 feet.
But it’s a good thing to have better access to information when you are in the air, right?
Filed under Access, Information, Value
Eggs and baskets
“Apple Puts iCloud Keys in China,” The Wall Street Journal, February 26, 2018 B1. Apple to store encryption keys for China-based customers of iCloud in China.
For all other customers, worldwide, Apple stores the encryption keys in the US.
So who owns those keys? Are the owners of the iCloud data concerned about this? Are the keys more or less secure in China rather than the US? Why did Apple decide to do this? For the convenience of the users?
Filed under Access, Controls, Corporation, Duty, Governance, Information, Internal controls, IT, Privacy, Protect assets, Security, Third parties
Refunds
“Citi’s Refund Tab: $335 Million, The Wall Street Journal, February 24, 2018 B10. Bank pays up for failing to lower credit card interest rates.
After you miss a payment, federal law requires credit card issuers to review your payment history after six months, and sometimes to lower your interest rate. Citibank failed to do this properly for 1.75 million customers, over six years. Apparently, Citi found the error itself, and reported it to the government.
Isn’t this how things are supposed to work? The government passes a law, companies put in processes to comply, and monitor their operations to make sure they do comply. When the monitoring discovers problems, the company reports to the government and refunds the money.
Filed under Compliance, Controls, Corporation, Duty, Governance, Internal controls, Oversight, Third parties, To report
Disinfectant
Doctors sometimes get paid for helping out medical device developers. Wouldn’t this be good to disclose? Congress thought so.
“MiMedx Didn’t Report Payments to Doctors,” The Wall Street Journal, February 23, 2018 B5. Company doesn’t report payments to doctors. Says the Centers for Medicare and Medicaid Services says it doesn’t have to.
Maybe the Physician Payments Sunshine Act applies, maybe it doesn’t. Nice to know there is such a statute. But some payments were disclosed, as required by some medical associations. And CMS says it doesn’t provide opinions on such matters.
Who are you going to believe? Do you disclose what you are required to disclose?
Sunshine is a great disinfectant.
Filed under Communications, Compliance, Controls, Corporation, Duty, Governance, Information, Internal controls, Oversight, Third parties, To report
MetLife
“Suit Against MetLife Spotlights Problems From Old Business,” The Wall Street Journal, February 22, 2018 B12. MetLife sued over its failure to pay proceeds of an annuity to the right person.
MetLife has a business that takes over the pension payment obligations owed by private plans. “MetLife has said it failed to aggressively search for people as they neared pension-eligibility age.” As a result, about 13,500 retirees weren’t getting their benefits, after MetLife had released some reserves (and thereby increased profits) related to the payment obligations. That reserve release has now been reversed, hitting fourth quarter results.
How does your company keep from losing contact with people to whom it owes money? Are they swept under the rug, and ignored unless they complain?
Is this information governance or ethics or something else?
See also Snoopy cried.
Filed under Accuracy, Board, Compliance, Controls, Corporation, Directors, Duty, Duty of Care, Governance, Internal controls, Oversight, Oversight, Protect assets, Third parties
Two to tango
Two interesting stories on page B1 relating to governance:
“Ford Official Fired for Misconduct,” The Wall Street Journal, February 22, 2018 B1. Top executive fired for unspecified bad conduct.
“Disney Producer’s Behavior Criticized,” The Wall Street Journal, February 22, 2018 B1. Successful producer may act and speak inappropriately, but is still running the high-profile “Frozen” production.
How important is context? One would think that the entertainment industry would be more sensitive than other industries in avoiding any hint of inappropriate (the PC term) behavior, and Disney in particular.
How does your company manage its culture? Does it enforce the rules against top managers, or big money producers? What does the Board say, both now and when something goes wrong (or is discovered) later? Are violations and punishments publicized internally?
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