Category Archives: Investor relations

Loose lips, revisited

The prior post was about what you say and in what medium.  So’s this one.

“SEC Probes Musk Tweets On Possible Tesla Buyout,” The Wall Street Journal, August 9, 2018 A1.  Were Elon Musk’s tweets about having lined up financing for a buyout false or misleading?  The SEC may want to know.

So, is information false or misleading?  I thought we had freedom of speech?  And (altogether too much) freedom to tweet?

Falsely shouting fire in a crowded theater is still a bad thing (thank you, Justice Holmes).  As is misleading your shareholders.

Should a CEO of a listed company know better?  Loose lips sink ships.

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Filed under Accuracy, Communications, Compliance, Compliance (General), Controls, Corporation, Definition, Duty, Employees, Governance, Information, Internal controls, Investor relations

Gee, what could go wrong?

“Facebook Asks Banks for Customer Data,” The Wall Street Journal, August 7, 2018 A1. “[T]o offer new services to users,” Facebook asks banks for “detailed financial information about their customers.”

I can see what’s in it for Facebook, and maybe for the banks.  But isn’t this your information?  Shouldn’t you have some control what the banks do with it?  Are you comfortable with the controls the banks and Facebook will place on this information?  It might be convenient for you, but at what risk?

Do we remember Cambridge Analytica?  Will Facebook try to do this in Europe?

To whom do you complain?  Your elected representative?  Your bank?  The state or federal regulators?

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Filed under Access, Controls, Corporation, Duty, Duty of Care, Governance, Information, Internal controls, Investor relations, IT, Oversight, Ownership, Privacy, Protect assets, Security, Third parties, Uncategorized, Who is in charge?

We didn’t know

Knowledge, or lack thereof, is often a good defense.

“Fiat Says It Didn’t Know CEO was Ill,” The Wall Street Journal, July 27, 2018 B1.  Company says privacy of health care information meant they didn’t know that their CEO had been sick for a year.

Who knew or should have known?  Was this insider information that would affect the value of investments?

Should the Board have known?  Did the CEO have a duty to disclose?  For more than a year!

Governance, Compliance, and Information.  All in one.  Add a dash of privacy.

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Filed under Access, Accuracy, Board, Communications, Compliance, Compliance (General), Compliance Verification, Controls, Corporation, Directors, Duty, Employees, Governance, Inform market, Inform shareholders, Internal controls, Investor relations, Oversight, Privacy, To report, Uncategorized

Churn ’em, Burn ’em, and Learn ’em

More of the same old stuff.

“Advisers Blew Whistle on Wells Fargo Wealth Unit,” The Wall Street Journal, July 28 2018 B1.  Sales incentives drive improper behavior at Wells Fargo.  Again.

The good news is that four Wells Fargo financial advisers tipped off the DOJ and the SEC to what was happening.  High-wealth investors were steered to investments that would result in higher fees paid to Wells Fargo.

So the culture wasn’t entirely corrupt.  There’s hope.

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Filed under Compliance, Compliance (General), Controls, Corporation, Culture, Duty, Employees, Governance, Internal controls, Investor relations, Policy, To report

Clarity

“Read This Extremely Important, Totally Incomprehensible, Completely Convoluted Information About Your Broker!” The Wall Street Journal, July 28, 2018 B1. Confusion over required SEC disclosures.

A four-page summary.  But will people read it?  Will most people read more than 4 bullet points?  Unless, of course, there’s a prize.

What value is disclosure if it is in language that the average person won’t read or won’t understand if he/she does?

Governance or Information?  And a pinch of Compliance?

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Filed under Accuracy, Communications, Controls, Corporation, Data quality, Duty, Governance, Information, Internal controls, Investor relations, Third parties, Value

Oops.

“Vanguard Messes Up Messages To Clients,” The Wall Street Journal, July 26, 2018 B10.  Money manager with over $5 trillion in assets under management sends text messages to clients that the money manager had processed loans against their 401(k) accounts.  But the customers hadn’t requested the loans.

Imagine the customer reaction.

How important is it to get your client communications right the first time?  Are you in the trust business?  Is claiming a “systems issue” enough?

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Fraudster

“Theranos Settle Investor Suit As Firm Runs Low on Funds,” The Wall Street Journal, July 23, 2018 B3.  Investors alleged Theranos had defrauded them by making false statements about the company’s technology.

This joins the long (and growing) list of people suing for harm caused by this company.  Are the directors in the dock?  The CEO and former president are.

False statements are information, in a sense.  The is the kind of basic, bog standard stock fraud that led to the creation of the SEC.

Who’s going to get the last drop of blood out of this stone?

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Filed under Board, Communications, Compliance, Compliance, Compliance (General), Controls, Corporation, Culture, Data quality, Definition, Directors, Duty, Duty of Care, Employees, Governance, Inform shareholders, Information, Internal controls, Investor relations, Oversight, Oversight, Protect information assets