Category Archives: Oversight

Near-hits

It seems that several (most of?) the large privacy breaches have something in common: something smaller happened earlier that people didn’t pay enough attention to.

“Marriott’s Starwood Missed Chance to Detect Huge Data Breach Years Earlier, Cybersecurity Specialists Say,” The Wall Street Journal, December 2, 2018 (online).  There was a prior breach in 2015 that, some say, could have been investigated more thoroughly.

Might this happen in your business?  Say there’s a relatively minor breach, affecting a single client’s information.  Or a minor compliance issue.  You discover it and take action.  But does the breach itself indicate weaknesses in your system of controls that may have broader implications?  Do you change your training or other controls to reflect this experience, or the experience of others in your industry?

This brings to mind a common finding in accident investigations.  Something small happened that could/should have put you on notice.  But it was ignored or downplayed.

How does your organization deal with near-hits in the compliance or information governance space?  Is this part of oversight?  Or a part of effective knowledge management?

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Filed under Analytics, Collect, Compliance, Compliance (General), Controls, Corporation, Directors, Duty, Duty of Care, Governance, Information, Internal controls, IT, Knowledge Management, Management, Oversight, Privacy, Protect assets, Security, Third parties, Use

Making a list and checking it twice

So, you have a baby coming.  You establish a baby registry online, and list the items/gifts you want to receive.  And then the host of the registry accepts payments from vendors of baby products to add certain items to “your” list.

Is nothing sacred?

“New Parents Complain Amazon Baby-Registry Ads Are Deceptive,” The Wall Street Journal, November 29, 2018 (online).  Amazon accepts money from major companies to put “sponsored ads” on your list; there’s a small gray box saying “Sponsored.”  Nothing descriptive like, “Similar to things the mother-to-be actually wants.”

I guess you have to check to make sure that you check “your” list at least twice, to make sure that Amazon hasn’t made it theirs.  No bait, just switch.

Where’s the FTC on this? Would you buy from a company that paid to advertise on someone else’s gift registry, without asking?  Are they a bit scummy?  These aren’t small-time companies; advertisers buying the ads include Kimberly-Clark and Johnson & Johnson.  To sell baby products!

Next thing, they’ll be posting billboards on your roof and on your car. Without so much as a by-your-leave.

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Filed under Accuracy, Compliance, Controls, Corporation, Culture, Data quality, Duty, Duty of Care, Governance, Information, Internal controls, Oversight, Ownership, Third parties, Value

Selling what isn’t yours

One profit model that seems to be working well is selling stuff that doesn’t belong to you.  Cuts your cost-of-goods-sold dramatically.

“Facebook Considered Charging for Access to User Data,” The Wall Street Journal, November 29, 2018 (online).  Facebook considered charging people to access user data.

Now, I guess that’s marginally different than letting third parties see the “Facebook” user data (i.e., the data of the users of Facebook) for free, in order to develop apps or whatever.  But isn’t it still the users’ information?  Oh, and it might be somewhat contrary to what the CEO said to Congress about Facebook’s policy of never selling user data.

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Filed under Access, Collect, Compliance, Controls, Corporation, Culture, Duty, Duty of Care, Governance, Information, Internal controls, Management, Oversight, Ownership, Ownership, Third parties, To report, Use, Value

Those pesky Romulans!

You may not be old enough or nerdy enough to remember the Romulan cloaking device from the original Star Trek.  But I do/am.

“Fake Signals and Illegal Flags: How North Korea Uses Clandestine Shipping to Fund Regime,” The Wall Street Journal, November 29, 2018 (online). How do shipments still arrive in and leave from North Korea, notwithstanding the various sanctions on the regime there?  Apparently, it’s blue smoke and mirrors.

I raise this here for two reasons.  First, in the North Korean story this is a bunch of information being generated that is deliberately false, and the compliance types struggle to deal with it in order to enforce the applicable rules.  The enforcers use satellites and data analytics; the shippers use deception and semi-legal and illegal stratagems.

Second, what extremes might your employees go to to avoid being detected when they are doing something they know is wrong, and how well prepared are you to deal with it?  Do you have the proper controls and investigative procedures?  What should you look at to confirm that what you’re being told is true?

 

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Filed under Collect, Compliance, Compliance, Compliance (General), Controls, Corporation, Data quality, Directors, Duty, Employees, Governance, Information, Internal controls, Management, Oversight, Policy, Supervision, Third parties, To report, Use

What happens when the boss gets jailed?

This blog tends to mention cases where senior executives get (or don’t get) punished for their alleged misdeeds.  The spin is often that the seniors don’t get punished as hard as the worker bees.

But what happens when the CEO gets put in jail for his or her alleged misdeeds, which may have led to under-reporting in the company’s financials for the past five years?

“Carlos Ghosn’s Arrest Rocks Auto Empire,” The Wall Street Journal, November 21, 2018 (online).  Nissan’s CEO jailed for allegedly under-reporting his earnings by several tens of millions of dollars.

How do you explain this to the worker bees?  What’s the culture at the top?  How did the Board not catch this?  Were there not controls in place?  Might the shareholders be a bit upset?

More a Governance and a Compliance issue, perhaps, although if one looks, one could find some information-related failures.

 

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Filed under Board, Compliance, Compliance (General), Compliance Verification, Controls, Corporation, Culture, Culture, Data quality, Directors, Duty, Duty of Care, Governance, Internal controls, Oversight, Oversight

Coming up to speed

Marriott Says Starwood Data Breach Affects Up to 500 Million People,” The Wall Street Journal, November 30, 2018 (online).  Data breach potentially affecting passports and credit cards of as many as 500 million guests at Marriott’s Starwood properties, which were acquired in 2016.  They knew about this in September, but reflects a breach that may go back to 2014.

So, two years after an acquisition, the target’s information security practices blow up in the acquiror’s face.  What does that say about the acquiror’s duty to integrate the data practices and controls around information protection?

Does your M&A team think about information governance issues?  Is that an identified risk, with an identified (and owned) action plan?  Did the Board identify this as a risk?  What the value of this information considered part of the transaction value?  How was that reflected?

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Filed under Board, Compliance, Compliance Verification, Controls, Corporation, Directors, Duty, Duty of Care, Governance, Information, Internal controls, IT, Management, Oversight, Protect, Protect assets, Protect information assets, Risk Assessment, Risk assessment, Security, Value

External governance

“Rebuke at Wells Shows Clash,” The Wall Street Journal, November 15, 2018 B1.  Chief administrative officer (and former head of HR) at Wells placed on leave after the Office of the Comptroller of the Currency criticizes the oversight that she and the bank’s chief auditor provided.

If your company interacts with government regulators (and whose doesn’t?), is the government effectively a part of your governance structure?  Or is government a separate component of Governance, whether that is Compliance Governance or Information Governance?  Or just “Governance”?

And what does it say about communications when the government holds up a senior official for poor oversight?  What about the board?  Highly visible to the worker bees.

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Filed under Board, Communications, Compliance, Compliance, Compliance (General), Controls, Corporation, Duty, Employees, Governance, Government, Internal controls, Management, Oversight, Oversight, Third parties, To report