Category Archives: Corporation

Indicted

A Tesla employee is indicted for creating fake documents to cover up a fake-payment scheme.  “Former Tesla Employee Is Indicted,” The Wall Street Journal, November 12, 2018 B5.

Companies have a lot of controls to prevent fraud by employees, and often these controls work.  Why are there more such controls to prevent financial fraud than to prevent violations of other company procedures, such as those related to document creation, retention, and storage?

One wonders whether, in the aggregate, companies lose more money through poor document management and control than they lose through financial fraud.  How would one conduct such a study?

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Filed under Accuracy, Compliance, Compliance (General), Controls, Corporation, Directors, Duty, Duty of Care, Employees, Governance, Information, Internal controls, Oversight, Protect assets, Records Management, Security, Third parties, Value, Vendors

More of your data for sale

“Wall Street Analysts Are Selling More Data,” The Wall Street Journal, November 8, 2018 B11. Analysts are searching and make available a bunch of information on your information, including “social media sentiment … and geospatial mapping.”  Think of it as expanded research reports.

Well, they are in the business of reviewing data and offering opinions (for a price).  Is it much of a disintermediation for them to start selling the information directly?  I guess there’s money in it.  Or service.

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Filed under Access, Analytics, Collect, Controls, Corporation, Duty, Information, IT, Management, Operations, Ownership, Security, Third parties, Use, Use, Value

Technology controls

“Wells Fargo Technology Under Scrutiny,” The Wall Street Journal, November 8, 2018 B11. Questions being raised about the technology the bank uses for cybersecurity and risk management.

Do you have the right technology to effectuate the controls you have placed around information?  Will your regulators agree?  If you are already on the regulator’s radar screen, will your controls measure up?

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Filed under Controls, Corporation, Duty, Governance, Internal controls, IT, Oversight, Protect, Protect assets, Risk assessment, Security, Technology

Too much sharing

I’m a bit of a knowledge management wonk, having been involved in the then-nascent KM movement within the inhouse legal community in the early 2000s.  But there can be too much sharing.

“Sinclair Settles With U.S. on Ad-Sales Data,” The Wall Street Journal, November 8, 2018 B2.  A media group settles lawsuit over alleged sharing of information among television station owners, that may have led to higher advertising rates.

An interesting side note is that this all came to light when Sinclair proposed to buy another company and had to undergo a government investigation.

Are there restrictions on how much information can be shared between and among competitors?  Yes.  They are call “antitrust laws.”  And is there a risk of making a deal that subjects you to government scrutiny?  Yes.  The may discover all manner of minor and major sins.

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Filed under Access, Communications, Compliance, Compliance (General), Controls, Corporation, Discovery, Duty, Governance, Information, Internal controls, Knowledge Management, Oversight

Crisis information

How do you protect information in the event of an Event?  Is this part of your business continuity plan?  You do have a business continuity plan, right? Do you have a process to safeguard information you will need to resume operation?

“Second Black Box Eludes Search Teams,” The Wall Street Journal, November 3, 2018 A6.  Divers are still searching for the cockpit voice recorder following the crash of Lion Air flight 610 in Indonesia.

Planes carry two “black boxes,” one  a flight data recorder (which captures a lot of equipment operating data) and the other a cockpit voice recorder (which captures conversation in the cockpit).  The information on these two boxes (which are actually neon orange) is used to determine the cause of a crash.

What information does your company generate that you would need to run your business following an “Event,” such as a computer crash or a hurricane, or whatever?  Is that part of your normal operating policies and procedures?  If you can’t get to that information, can you restart or run your business?

Is this an Information point (protecting information) , or a Governance point (having processes and procedures to protect mission-critical information), or a Compliance with policies and procedures?

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Filed under Access, Business Case, Collection, Controls, Corporation, Duty, Governance, Information, Internal controls, Oversight, Protect, Protect assets, Risk, Use, Value

Better than nothing?

Have you ever misused your company credit card?  How about used a company asset for your personal business?

“Gulfport CEO Exits Following Review,” The Wall Street Journal, November 2, 2018 B2.  CEO resigns after investigation into his use of his company credit card (he had paid the charges back, eventually, without interest) and the company plane.

On departure, he gets $400,000 and 6 months of health care coverage.  I don’t know whether that’s better than nothing.

The ground troops learn from their “betters.”  Seeing the CEO get canned for policy violations firms up the perception of the seriousness with which the company treats violations of policy or procedure.  More so than a ground troop getting canned.

Does your company publicize these stories?

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Filed under Compliance, Controls, Corporation, Duty, Employees, Governance, Internal controls, Oversight, Policy, Protect assets

Fraud at the top

“Former Goldman Bankers Charged,” The Wall Street Journal, November 2, 2018 A1. “Two senior … bankers allegedly paid bribes and stole and laundered money … [in] one of the biggest financial frauds in history.”

What does it say when two of your 435 partners and one of your managing directors commits a fraud?  Failures in systems/controls?  Bad culture?  Do you have a “cowboy atmosphere” in Asia?  Poor training?  Are these rogue employees?  What’s the impact on your reputation?  What was the tone at the top?

This is primarily a Governance point.  How will the new CEO handle?

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Filed under Compliance, Compliance (General), Controls, Corporation, Culture, Directors, Duty, Duty of Care, Employees, Governance, Oversight, Policy, Supervision, Who is in charge?