Motoring Discussion > SEC vs. VW. Green Issues
Thread Author: No FM2R Replies: 11
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New Fri 15 Mar 19 17:02 
 SEC vs. VW. - No FM2R

Well, that'll be VW screwed then.

www.bbc.com/news/business-47578888
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New Fri 15 Mar 19 18:09 
 SEC vs. VW. - Zero
From a legal and evidential viewpoint I think the case for financial fraud is on very thin ice indeed, and would fail in any court.

However, the SEC cares not about such niceties, has the abilities to tie VW into procedural and legal knots, has massive financial and incarceration penalties to play with, so they will end up settling at enormous cost.
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New Fri 15 Mar 19 18:51 
 SEC vs. VW. - No FM2R
If you judge the company as a single entity, then the ice is not thin. Which is why VW will make a massive settlement.
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New Fri 15 Mar 19 19:46 
 SEC vs. VW. - Zero
Not sure. This is the SEC who have a fairly tight brief, have formulated a pretty ringfenced charge, in that VW intended to defraud with a rights issue. But I guess at the end of the day they can collar them under one of the wide ranging corporate responsibility aspects of Sarbanes Oxhey

Either way we agree VW will settle. Expensively
Last edited by: Zero on Fri 15 Mar 19 at 19:47
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New Fri 15 Mar 19 20:00 
 SEC vs. VW. - No FM2R
>>Either way we agree VW will settle. Expensively

Agreed.

And will forever be under the spotlight. This diesel thing has already cost them over £40bn, that really is an enormous screw up.

I wonder what chance the shareholders going after the CEO personally in a class action. I wouldn't surprise me, though they'd have to show that he knew about it.
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New Fri 15 Mar 19 23:07 
 SEC vs. VW. - Kevin
>..they'd have to show that he knew about it.

My memory may be playing tricks but I seem to recall that the bar is set pretty low for SEC or SOX violations that affect investors. Something along the lines of "he/she could or should have known". It effectively puts the burden of proof on the accused that he/she did not know.

One way around that of course is to push responsibility for reporting possible breaches as far down the corporate hierarchy as possible ie. "Your Honor, all employees received training and acknowledged that training. Management received no warnings that this situation had occured."
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New Fri 15 Mar 19 23:26 
 SEC vs. VW. - No FM2R
You are correct.


I deliberately used 'show' rather then 'prove' but should have them included something like 'reasonably be expected to know".
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New Sat 16 Mar 19 09:54 
 SEC vs. VW. - Zero

>> One way around that of course is to push responsibility for reporting possible breaches as
>> far down the corporate hierarchy as possible ie. "Your Honor, all employees received training and
>> acknowledged that training. Management received no warnings that this situation had occured."

You must have been on the same SOX training stream I was. It was pointed out quite candidly that this was "to stop your leaders being thrown in jail for anything you do". There was an embarrassed silence when someone said "so its not to obfuscate the blame?"

Of course we all had to sign at the pain of death at the hands of a three line management whip to say we were SOX compliant, and to do so every year.
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New Sat 16 Mar 19 13:16 
 SEC vs. VW. - No FM2R
>>"to stop your leaders being thrown in jail for anything you do"

It is a worry. I am often surprised about how out of touch certain directors are prepared to be or how lax they are prepared to allow reporting processes to be.

To keep safe you need to stop illegal behaviour as much as possible, and where you cannot be sure you have stopped it or will continue to prevent it, you have to make it as deliberate as possible and force them to intentionally deceive the governance systems.

Hence -> SOX. One of the greatest pains in our a***s since 5750/9000 began.
Last edited by: No FM2R on Sat 16 Mar 19 at 13:17
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New Sat 16 Mar 19 13:34 
 SEC vs. VW. - sooty123
What's SOX?
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New Sat 16 Mar 19 13:51 
 SEC vs. VW. - Zero
It a bill that passed in the USA in the wake of the Enron and Worldcom scandal. Failed to prevent the sub prim loans scandal tho.

en.wikipedia.org/wiki/Sarbanes–Oxley_Act

What does that have to do with us in the UK you may think, well anyone who works for a US based company, or a company listed on the US stock exchange, or one that does a major amount of business with US companies, has to be compliant with the SOX code.

Hence the rise of things like JSOX.

safenet.gemalto.com/data-protection/data-compliance/j-sox-compliance/

Brought in because of the sumitomo scandal, and the fact many Japanese companies have major ties with us companies.

Carlos Gohsen will have been indicted under the JSOX legislation.
Last edited by: Zero on Sat 16 Mar 19 at 13:54
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New Sat 16 Mar 19 14:22 
 SEC vs. VW. - sooty123
Thanks.
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