Corporate
Cultures of Deception: media reports and litigation reveal the inner culture of
a company's approach to business
Before taking on a subcontractor based
overseas, one of SI's accounting firm clients requested a standard
investigation. While not all the search elements available in the US are open
to the public in other countries, the investigation uncovered one of the most
outlandish examples of corporate misbehavior we've seen to date. International
media searches revealed that this technology firm's corporate culture
encouraged deceptive behavior at every level of operations. News stories
reported that the company was under investigation for allegedly importing
software from the US between 2007 and 2009 without declaring the complete value
of the imports. Further, in 2009 the company was barred from receiving
contracts by World Bank for offering to sell IPO stock to family and friends of
World Bank executives. But disreputable practices not only occurred at the top
levels. Articles from 2007 reported that a human resources manager was implicated
in a complaint filed by the wife of an engineer employed by the company who charged
that the entity gave her husband a "dating allowance." The claimant alleged
that the company "promoted illicit relationships" by giving her husband an
allowance that helped him maintain illicit relationships. A company spokesman
denied the allegations, but the court subsequently subpoenaed two more human
resources employees who affirmed the claims. Taken together, these pieces of
information were enough to paint the whole picture of the company's culture of
deception.
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Oregon limits use of
credit information in employment decisions:
On March 29, the State of Oregon adopted
legislation (SB 1045) that limits employers' use of credit history when making
employment decisions. SB 1045 states that, except where employees are public safety officers and
employers are certain financial institutions or public safety offices, "it is
an unlawful employment practice for an employer to obtain or use for employment
purposes information contained in the credit history of an applicant or an
employee, or to refuse to hire, discharge, demote, suspend, retaliate or
otherwise discriminate against an applicant or employee with regard to promotion,
compensation or the terms, conditions or privileges of employment based on
information in the credit history of the applicant or employee." This legislation was proposed to be effective
July 1, 2010; however, Governor Ted Kulongoski declared it effective
immediately. For more information on exceptions and to read the bill in its
entirety, see http://www.leg.state.or.us/10ss1/measpdf/sb1000.dir/sb1045.en.pdf |
May case study preview:
In May, SI will bring you the story of an "entrepreneur" who left a trail of unpaid debt, fines
and criminal charges that spanned across Europe and the US.
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