Category Archives: Oversight

Wells Fargo, again

“Wells Fargo Gets New Warning,” The Wall Street Journal, November 30, 2017 B1.  Feds may take enforcement action over the company’s auto-insurance and mortgage operations.

Will the shoes ever stop dropping at Wells Fargo?  Once you are shown to be non-compliant, do you get stuck under the regulatory microscope?

How’s that suit against the directors going?

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Filed under Board, Compliance, Compliance, Compliance Verification, Controls, Corporation, Culture, Directors, Duty, Duty of Care, Employees, Governance, Internal controls, Oversight, Oversight

Breach at PayPal

“PayPal Discloses Breach At Its TIO Unit,” The Wall Street Journal, December 2, 2017 B11.  Upwards of 1.6 million users affected at newly acquired company that has kiosks in retail stores.

When you acquire a company, make sure their cybersecurity is up to snuff.  From Day One.

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Filed under Board, Compliance, Compliance Verification, Controls, Corporation, Duty, Duty of Care, Governance, Internal controls, IT, Oversight, Oversight, Protect assets, Protect information assets, Security, Supervision

Covert units

It’s a bad sign when you establish a covert unit.

“Uber Formed Covert Unit to Steal Trade Secrets, Ex-Employee Says,” The Wall Street Journal, November 29, 2017 A1. According to a former security employee, Uber “had a team dedicated to stealing [competitors’] trade secrets and helped employees dodge regulators’ scrutiny.”

This information was in a letter read to the jury in the Alphabet/Uber trade secret litigation.  Ouch.

What does it say about the company’s commitment to compliance with law (including the rights of others)?  Are RICO charges far behind?

If Uber loses the case, will shareholders sue the directors who allowed this to happen?

 

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Filed under Board, Compliance, Compliance, Controls, Corporation, Culture, Culture, Directors, Duty, Duty of Care, Employees, Governance, Internal controls, Management, Oversight, Oversight, Supervision

Wells Fargo, continued, again

“Wells Fargo Bankers, Chasing Bonuses, Overcharged Clients,” The Wall Street Journal, November 28, 2017 A1.  Only 35 of 300 companies had been charged only what they had agreed to.  Four foreign-exchange bankers fired.

Who is surprised?  The culture at the company was potentially fatally defective.

Why hasn’t the Board been held liable?  The directors utterly failed in their fiduciary duties.

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Another one bites the dust

“Steinhoff’s CEO Resigns Amid Accounting Probe,” The Wall Street Journal December 7, 2017 B3.  Off-balance sheet accounting leads to resignation of CEO of parent company of Sleepy’s (a mattress brand), and a drop of 62% in share value.

Where was the Board?  Where were the auditors?  Trying out the company product?

Who pays the price of management’s failure?

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Filed under Accuracy, Compliance, Compliance, Compliance Verification, Controls, Corporation, Culture, Duty, Employees, Governance, Information, Internal controls, Oversight, Oversight, To report, Value

Private Air and a spare

Would you hide something stupid from the Board?

“GE Board in Dark on CEO’s Use of Extra Jet,” The Wall Street Journal, October 30, 2017 B1.  As if it weren’t bad enough that the CEO flies on the company plane, it appears that he brought a second plane along, just in case.

Now why would you keep that secret?  Even after an internal complaint several years ago?  How do you define waste?  Who thought that this was an appropriate use of the shareholders’ money?

Might there be gaps in the compliance program?  If this slipped through, what else is out there?

 

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Trending

“Fidelity Is Hit by Employee Conduct Problems, The Wall Street Journal October 23, 2017 A1.  Several high-level employees canned following sexual harassment allegations.

Who knew Harvey W. would start a trend that reached beyond entertainment into high-finance?

Did these companies not have policies against sexual harassment and bullying?  Had compliance with the policies been audited?  What’s the compliance history?

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Filed under Board, Compliance, Compliance, Compliance Verification, Controls, Corporation, Culture, Directors, Duty, Employees, Governance, Internal controls, Oversight, Oversight