Category Archives: Oversight

Catching up

I was working on another project, and could not do my postings as timely as I would like.  But here’s a bunch of news items I wanted to write about:

Leave a comment

Filed under Compliance, Compliance, Controls, Corporation, Directors, Duty, Duty of Care, Employees, Governance, Lawyers, Oversight, Ownership, Privacy, Third parties, Uncategorized

VW Compliance Executive Pleads Guilty

“Ex-VW Official Admits Role in Emissions Cheating,” The Wall Street Journal, August 5, 2017 B3. A former VW “compliance executive” charged with conspiracy to defraud the US, wire fraud, and Clean Air Act violations pleads guilty.  He admits he knew about the software used to mislead US environmental regulators.  Faces sentencing in criminal case in December.

Hiding information from the government is not a good thing.  What was the culture that allowed this to happen?  Did people feel a need to do this to compete?  Too many car companies have been caught up in such scandals to have it be random.

The shareholders have paid (and are continuing to pay) for the mistakes of the employees of the company.  Who else from the company is going to go to jail,  or lose his/her job?  VW is facing costs in just the US of more than $25 billion and investigations elsewhere.  Does the “compliance executive” know of others who also knew?  Might he offer up some names before December?  People who bought VWs are going to want to recover damages from someone.

Leave a comment

Filed under Accuracy, Analytics, Board, Compliance, Compliance, Controls, Corporation, Culture, Culture, Data quality, Directors, Duty, Employees, Governance, Information, Internal controls, Oversight, Oversight, Value

Keeping it in the family

“Two Plead Guilty in Insys Cases,” The Wall Street Journal, July 12, 2017 B3.  Insys Therapeutics had an unusual fentanyl problem: bribing doctors to prescribe it.  Two saleswomen took the plea.

Notable:  one of the women is married to the firm’s former CEO, who  was arrested on related charges in December, together with 5 other senior managers.

Does corruption normally run this deep?  Where is (or was) the board?

Leave a comment

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

Pesky little documents

“Caterpillar Faces New Questions in Probe,” The Wall Street Journal, July 3, 2017 B1.  During a criminal investigation, required export documentation couldn’t be found. Apparently, there are also inconsistencies between what was submitted to the Department of Commerce and what was turned over in response to subpoenas.

So, a corpration may be charged criminally.  What about officers, directors, and employees?

It is only foolish consistency, not inconsistency, that is the hobgoblin of little minds.

Leave a comment

Filed under Accuracy, Compliance, Compliance Verification, Controls, Corporation, Data quality, Duty, Employees, Governance, Information, Internal controls, Oversight, Value

Cyberattacks, revisited

It’s Groundhog Day.  Or becoming a dog-bites-man story.

“Cyberattack’s Fallout Fuels Scramble,” The Wall Street Journal, June 29, 2017 B3. A ransomware attack through Microsoft Windows hits Maersk, Merck, WPP, and Rosneft, among others.  Surgeries disrupted at a Pennsylvania hospital.  “Hospital Operator In Pennsylvania Works to Recover,” The Wall Street Journal, June 29, 2017 B3.

Does this become so routine we forget people are supposed to take steps to prevent it?  Do cyberattacks make the board agenda, without the tie to the greater information governance questions?  Is that progress?  Does industry not see the bigger risk?

 

Leave a comment

Filed under Access, Controls, Duty of Care, Governance, Information, Interconnections, Internal controls, IT, Oversight, Protect assets, Security, Third parties, Value

Altered metrics

If someone asks you to “alter” or “fudge” a financial metric reported to the market, take pause.  Or hit the big red button.

“Witness: Magnate Knew of Altered Metric,” The Wall Street Journal, June 28, 2017 B9. The chairman of a large company allegedly knew that one of the financial metrics the company reported to the market for the previous quarter was improperly inflated.  Or fudged, as they say in the trade.  By $12 million.

The former chief accounting officer took a plea to fraud (and admitted to lying on other matters) and is cooperating with the government; the former CFO is charged with criminal fraud and is at trial.  The company is “cooperating.”  The chairman hasn’t been charged.  Yet.

Why isn’t the company charged?  At least one of its agents appears to have committed a fraud.  Why isn’t the chairman charged, if he knew?  Is this consistent with the Yates memo?  Is there a civil (derivative) suit against the chairman?

Leave a comment

Filed under Accuracy, Board, Collect, Communicate, Compliance, Compliance, Compliance, Controls, Corporation, Directors, Duty, Duty of Care, Employees, Governance, Inform market, Internal controls, Management, Oversight, Oversight

Who checks the checkers?

Compliance with law and compliance with policy and procedure are relatively easy to establish.  But compliance with ethics?

“Journal Reporter Fired Over Ethics,” The Wall Street Journal, June 22, 2017 A2.  A foreign affairs reporter at The Wall Street Journal was fired for something related to “his dealings with an aviation tycoon whom he had cultivated as a source.”  Further details weren’t provided.  It may have been the offer from the tycoon of a share in one of his companies.  Perhaps he wasn’t totally honest with the paper about something (but we don’t know what, yet).  A violation of journalistic ethics?

All this may have been revealed following a hack of email or text messages, or both.

Seems a bit squishy without more details as to what were the ethics and what was the violation.  Were I a reporter for the paper, I’d be curious what the lines were and how were they crossed.  This perhaps goes beyond the common stricture of “Don’t lie, cheat, or steal.”

Were this a corporate exec or a governmental official, would we get more detail?  Who checks the checkers?

Leave a comment

Filed under Compliance, Controls, Culture, Duty, Employees, Governance, Internal controls, IT, Oversight, Security