Under Investigation, and Doing the Investigation
Is it a good thing that much of the effort to police corporate misconduct seems to have been
shifted to lawyers retained by the companies under investigation?
A corporate investigation can easily cost a company millions of dollars, and sometimes much more. The German conglomerate Siemens paid over $1 billion in legal
and accounting fees for its global inquiry into extensive bribery by employees. Companies would prefer not to conduct an investigation
at all. But having a law firm they hired overseeing the inquiry means they can maintain control over information, and minimize
Big Law Steps Into Uncertain Times
Members of Congress trade in companies while making laws that affect those same firms
One-hundred-thirty members of Congress or their families have traded stocks collectively
worth hundreds of millions of dollars in companies lobbying on bills that came before their committees, a practice that is
permitted under current ethics rules, a Washington Post analysis has found.
The lawmakers bought and sold a total of between
$85 million and $218 million in 323 companies registered to lobby on legislation that appeared before them, according
to an examination of all 45,000 individual congressional stock transactions contained in computerized financial disclosure
data from 2007 to 2010.
Almost one in every eight trades — 5,531 — intersected with
legislation. The 130 lawmakers traded stocks or bonds in companies as bills passed through their committees or while Congress
was still considering the legislation. The party affiliation of the lawmakers was almost evenly split between Democrats and
Republicans, 68 to 62.
STATE OF GEORGIA, USA: A Case Study on How NOT to Run an Ethics Commission
Perhaps no state illustrates the political perils of ethics enforcement better
than Georgia, where the ethics commission has been the nexus of more infighting, vitriol and litigation than a Univision novella.
Keeping track of all the resignations, firings, accusations and countercharges there has challenged even the most knowledgeable
observers of Peach State politics. Three executive directors have resigned or been fired since 2006. Two other employees collected
$405,000 in damages for allegedly wrongful termination. Lawmakers stripped the agency of 40 percent of its funding, its power
to make new rules, even its name.
Today, public pressure builds for ethics reform in Georgia, which received an 'F'
grade and ranked dead-last in the State Integrity Investigation's review of state government ethics and accountability. The
agency charged with policing government ethics there faces a host of challenges:
Much of this has come to pass, critics say, because the commission answers to the
very politicians it’s supposed to regulate and investigate. Legislative leaders set its budget, control its powers and,
along with the governor, decide who its five members will be. In the view of many of the body’s critics, that system
STATE OF GEORGIA: Ethics commission: State has defanged its watchdog
The state ethics commission is
an agency in free fall.
That is not news
to local officials who complain of its slow, inefficient bureaucracy, or state officials who kick it around like a political
football, or even good government groups wailing at its ineffectiveness.
Still, the completeness
of its collapse is striking. In five years, the commission’s funding declined 41 percent, and its staff was cut by a
nearly equal percentage. The number of cases it handled plummeted even more. Civil penalties it levied for ethics violations
dropped 94 percent.
For the Millionth Time: Yes, Ethics Matter... Duke Energy Corp paid CEO $44 million to work for one day
Duke Energy agreed to acquire Progress Energy, and the widely known, publicly
disclosed plan called for Progress CEO Bill Johnson to lead the combined company as the chief executive. The sale closed last
week, and within hours Duke announced that, no, actually its
pre-existing CEO Jim Rogers
would continue in that role, and Johnson would leave —with a severance package worth, in total, $44 million...
It may well be that Duke Energy did nothing illegal. The company
signed an employment agreement with Johnson on June
27, and that agreement did include all the severance awards he now seems poised to get. Johnson
was then appointed CEO of Duke Energy on the morning of July 2, and resigned that afternoon...
...even if this
deal passes legal muster, it still stinks to the public, and Duke's leaders failed to follow to standards of good behavior.
The directors at Progress Energy have publicly stated that they feel duped, misled by
Duke into a merger they never would have approved had they known that Johnson was a dead man walking.