“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 Governance, Protect assets, Duty of Care, Controls, Third parties, Internal controls, Compliance, Board, Oversight, Oversight, Duty, Directors, Accuracy, Corporation
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?
Filed under Board, Communications, Compliance, Compliance, Controls, Corporation, Culture, Culture, Directors, Duty, Duty of Care, Employees, Governance, Inform market, Inform shareholders, Internal controls, Oversight, Oversight, To report
The news media has an obligation to verify its reports. Is YouTube “news media”?
“YouTube Mistakenly Promoted False Video,” The Wall Street Journal, February 22, 2018 A4. YouTube apologizes and removes video suggesting an alleged witness to the Parkland shootings was an actor and not a student.
Is YouTube merely a carrier of content provided by others or does it’s role in curating content make it liable if the curating yields misleading results? Does YouTube have the protections available to The New York Times? Should it? Who decides?
“‘Success Theater’ Masked Rot at GE,” The Wall Street Journal, February 22, 2018 A1. GE’s CEO may have been too optimistic. “This culture of confidence trickled down the ranks ….”
If the top boss has rose colored glasses, that view apparently permeates the organization. If he or she reacts badly to bad news, do people stop bring bad news?
One principle of compliance is that the tone at the top matters. Does the CEO’s tone build filters that prevents him/her getting the facts? Are the resulting wounds self-inflicted? Where was the Board?
Filed under Data quality, Governance, Communications, Controls, Internal controls, Culture, Board, Oversight, Oversight, Access, Duty, Employees, Accuracy, Managers
Not sure whether this is more about governance than about information.
“AT&T Thwarted In Focus On Trump,” The Wall Street Journal, February 21, 2018 B1. AT&T wants information on internal government discussions, in order to rebut the government’s attack on the proposed acquisition of/merger with Time Warner. Court says no dice.
On the information point, how much is it worth to get information you don’t have, but suspect will help you? How much is it worth to keep your internal government discussions private?
On the governance point, one governing authority (the Executive Branch) moves to block a transaction, alleging it’s anti-competitive. The parties to the proposed transaction sue for access to the Executive Branch’s internal documents, to demonstrate alleged bias. The Executive Branch says “no.” Another governing authority (the Judicial Branch) also says “no.”
Whose information is it? Who’s in charge (i.e., governing)?
“U.S. Bancorp Is Charged, Fined in Laundering Case,” The Wall Street Journal, February 16, 2018 B2. Bank fined over $600 million and criminally charged with laundering money. And placed under a deferred prosecution agreement, which is always an adventure.
Bank allegedly constructed and operated its controls on money laundering “‘on the cheap.'” Think of the money they saved!
Their shareholders, not so much.
How much would having adequate controls and filing required suspicious activity reports have cost? More or less than $600 million?
A key compliance requirement for banks is to have adequate money laundering controls. What does it say about the directors and officers that this bank didn’t have them? Who’s responsible for this failure (i.e., who’s duty was it to prevent this?)? Who’s getting canned?
Filed under Board, Compliance, Compliance, Controls, Corporation, Directors, Duty, Duty of Care, Employees, Governance, Internal controls, Oversight, Oversight, Protect assets, Protect information assets, To report
The cobbler’s children have no shoes. Experts tend not to tend to things at home.
“Errant Charges at Coinbase,” The Wall Street Journal, February 17, 2018 B9. A bitcoin firm ended up charging its customers multiple times (as many as 50!) for the same transactions. Blames its vendors.
Let me see. You can’t work out your own electronic invoicing and you want to store our digital currency? We should trust you why, exactly?
Wouldn’t you think you’d keep a close eye on the processes by which customers are charged and you are paid?
Filed under Accuracy, Board, Controls, Corporation, Directors, Duty, Governance, Interconnections, Internal controls, IT, Oversight, Supervision, Third parties, Vendors