Dior and CBS – Profiles in Courage

Christian Dior suspended “without hesitation” one of its top designers, John Galliano, for allegedly making anti-Semitic remarks.  Two days later, Mr. Galliano was terminated. Meanwhile, across the Atlantic, CBS halted production of the Charlie Sheen hit television show, “Two and a Half Men,” for Mr. Sheen’s double-hitter of anti-Semitic remarks directed at his bosses. Dior stood to lose its red-carpet exposure, as it were, at the Oscars as the starlets opt for scandal-free designers.  CBS stands to lose about $100 million in ad revenues for stopping Continue reading

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Felonious Fads

Lindsay Lohan arrived for her court appearance on felony charges (she is alleged to have stolen a $2,500 necklace) clad in a clingy designer mini-dress (Kimberly Ovitz).  Once the photos of Lohan in Ovitz hit the intertent, the dress sold out around the country.  Who doesn’t want to show that she has the same fashion je ne sais quoi as a Hollywood starlet gone south?

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Angelo Mozilo, Everybody Did It, and the Wall Street Journal’s Holman Jenkins

Angelo Mozilo, the former CEO of Countrywide Mortgage, whose perpetual tan and leathery look bring the phrase, “Can melanoma be far behind?” enjoyed a defense from the Wall Street Journal’s Holman Jenkins.  Mr. Jenkins never met a slotting fee, an options back-dater, or an insider trading cad he can’t defend. Mr. Jenkins has a good mind that offers brilliant legal and financial analysis of the troubling issues and figures in business. His articles on executives facing overzealous prosecutors are must-reads.  But, Mr. Holman has a blind spot on ethical questions – he never goes there. Continue reading

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The Golfer and the Warm-Up

It was a golf fan/television viewer who knew his rules and wrote in via a blog, “So I guess there were no LPGA officials on hand at the event to tell her she couldn’t do that?” The “that” was LPGA golfer Juli Inkster’s use of a weighted donut to warm up after a 30-minute delay in play.  Rule 14-3 says that practice devices are prohibited during play. The LPGA officials looked at the video and disqualified Ms. Inkster from the Safeway Classic.  At the time, Ms. Inkster was just three behind the tournament’s first-place golfer and offered her explanation, “It had no effect on my game whatsoever.”  So, why do it?  Why the rule if practice devices are irrelevant?  Continue reading

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In the pot and kettle department . . . WikiLeaks Suing a Former Staff Member for Taking Documents with Him

Daniel Domscheit-Berg, a former WikiLeaks staffer, is being sued by WikiLeaks for what he reveals in his new book, “Inside WikiLeaks:  My Time with Julian Assange at the World’s Most Dangerous Website.”  Mr. Domscheit-Berg has another website, “OpenLeaks.”  WikiLeaks also alleges that DDB took documents along with him that WikiLeaks wanted to release! Oh, what a tangled web we weave when first we practice to release others’ confidential documents.

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“Let’s go see (auditors) Friehling and Horowitz the next time we’re in N.Y. . . . To see that the address isn’t a car wash at least.”

J.P. Morgan Chase employee from the company’s due diligence team, expressing his concern that Bernie Madoff’s operation might be a Ponzi scheme.  The Madoff bankruptcy trustee has filed suit against J.P. Morgan for its failure to speak up when it had internal communications such as these floating about, many that were sent over one year before Madoff’s surrender to authorities.

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“Once I started to realize I wasn’t earning my money, I felt bad. I was making a crazy amount of money for not even pitching. Honestly I didn’t feel like I deserved it. I didn’t want to have those feelings again.” “

Gil Meche, a 32-year-old pitcher with the Kansas City Royals, who will not report for spring training because of problems with his shoulder that preclude him from pitching.  His contract allows him to be paid for having surgery and showing up for spring training where he would just have physical therapy.  Mr. Meche will not report, will not have the surgery, and has thereby given up $12 million. Let the record show that honor remains alive and well in this post-AIG, Goldman, Lehman, Bear Stearns, Merrill, Fannie Mae, Enron, WorldCom, HealthSouth, and Tyco et al. era.  Heed it well, all those who are collecting their bonuses based on 2008 performance, the year of their bail-outs.

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“I always like to do what the smart guys are doing.”

Merrill Lynch proprietary desk trader e-mailing a colleague about his purchase of 10,000 shares of Teva Pharmaceutical after a Merrill institutional client placed an order to sell 40,000 share of Teva.  Merrill was, in effect, trading on client data.  Continue reading

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“Otherwise, our business will stop and we will lose the market. We have to change our strategy and do more compensation to get the rewards.”

e-mail from Innospec’s agent in Iraq to CEO, Paul W. Jennings (no relation to the Barometer) on why Innospec needed to continue to pay Iraqi officials a 2% kickback.  Mr. Jennings settled FCPA charges by agreeing to pay $229,000.  Mr. Jennings neither admitted nor denied the FCPA violations. Mr. Jennings also fell into the seductive trap of the either/or conundrum.  He assumed the outcome and only one solution, but Continue reading

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In the “Hmmm” Category — Cam Newton and Auburn

Heisman winner and Auburn quarterback of the BCS championship-winning Auburn football team, Cam Newton, has announced that he will not be returning to his potential alma mater for his senior year.  He called the choice “difficult” for him and his family.  What led to the choice may prove even more difficult for Auburn and the NCAA. That $180,000 pay-to-play allegation hangs heavy over the victor and his family.

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The Barometer — Official Thought Leader

Marianne Jennings was recently selected as one of 2010’s Top 100 Thought Leaders in Trustworthy Business Behavior. This year’s list of recipients includes leaders from the public and private sectors as well as authors, consultants, researchers and academics. Selection is based on continuing and positive contribution to building trust in business.  The Top 100 Thought Leaders represents the culmination of two years of research. Continue reading

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In “Under the Bus” and “Never Trust the People You Cheat With” Category

When you are caught on a wiretap cursing, stewing, and fretting about being caught for insider trading, there are not many routes for your defense attorney to take.  Suppress the wiretapped conversations that indicate intent?  With that evidentiary fight lost, Danielle Chiesi, a fund manager, became the 17th person to enter a guilty plea in an insider trading ring that has resulted in criminal charges against charged 40 Wall Streeters and company executives.  Ms. Chiesi admitted that she acted as a conduit Continue reading

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“They pushed me hard to get here and invest, and then they pull the rug out from under me. The whole thing has left a bad taste in my mouth.”

Goldman client agitated over Goldman’s withdrawal of its Facebook offering over fears that it would run afoul of securities laws.  Oh, you poor naive man.  Did you not see the congressional hearings?  Did you not witness the SEC settlement?

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Hackers and Rationalizations

Andrew Auernheimer and Daniel Spitler were able to gather the email addresses of 120,000 Apple iPad users when they hacked into AT&T’s website in June 2010.  AT&T acknowledged a flaw in its website. Messrs. Auernheimer and Spitler fell victim to hubris and bragged publicly (i.e., in non-secure sites) about their cyber space prowess.  Their boasting also referenced Goatse Security, an unincorporated association of what prosecutors estimate to be ten internet hackers.  Mr. Auernheimer wrote in one e-mail about their AT&T conquest, “Serious like [sic] this is valuable data.” The two young men were arrested on January 18, 2011 and charged with unauthorized access and fraud in the use of personal information.

The federal prosecutor in the case stated, “Hacking is not a competitive sport and security breaches are not a joke.” Those in the internet security field responded, “Criticism should be leveled at both sides,” and “AT&T’s site wasn’t sufficiently secure.”[1]

I guess when we don’t lock our doors, we have a burglary coming.  And when we don’t have a car alarm Continue reading

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