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BMW fined $18M for providing inaccurate retail sales information to investors
- xwdv 6y ago$18M is just a cost of doing business at this point.
- zachshefska 6y agoExactly. The fraud is on the part of BMW, but also on the SEC for "slapping the wrists" of the OEMs, and not providing serious repercussions for this behavior.
- geodel 6y agoYeah bazillion dollar fine would be about right. People died because BMW lied.
- bostonpete 6y agoIsn't fining a company for misleading investors a kind of strange remedy anyways? Ultimately, a big fine would end up hurting the company's investors anyways...
- cma 6y agoThe deterrence effect could help protect future investors. The alternative is going after all the decision makers involved I guess?
- smabie 6y agoOkay, what kind of fine would you want? People on HN seem to want to lock up every CEO in existence and fine every company into bankruptcy, despite not even deeply understanding what kind of law breaking actually went on.
- jmholla 6y agoMore than they made.
- smabie 6y agoThey probably didn't make any extra money from this
- iratewizard 6y agoBMW should never be allowed to sell a car again. Within 3 years, drivers will start using their blinkers again.
- 542354234235 6y ago> Okay, what kind of fine would you want? Well, it is a financial crime for the purpose of profit by a corporation. Since you can’t jail a corporation, you have to disincentivize the law breaking. The only way you can do that is, at minimum, making the fine larger than the money profited from the crime. Otherwise that is not a disincentive, as it is a net positive to commit said crime. But since exposing these crimes is difficult, it is likely that the discovery of one crime is likely part of a pattern. So fining multiples of the profit would disincentivize even if the risk of discovery was low. As for CEOs, they are both in a position extreme power, and profit massively from company profits. So even through inaction or apathy to criminal activity, they can profit while not holding any liability. I personally think that if you want to be in that position, you should be held “strictly liable” for what goes on under your watch. If you don’t want to take responsibility for what is done under your watch as a CEO making 10s of millions of dollars, don’t take the job.
- xwdv 6y agoThe answer to this is usually some form of “until we’re satisfied” and the answer to when that will be is usually “never”.
- compiler-guy 6y agoThis style of fudging and outright fraud on timing (over your quota one month? Report the overage on the next month to give yourself some breathing space), is utterly commonplace within sales culture generally. I'm sure it doesn't happen everywhere, but where your compensation and value is entirely determined by sales goals, this kind of thing goes on rampantly. For example, the Wells Fargo Account Fraud scandal came from exactly the same kinds of things--A massive drive to meet your goals at the expense of all else. Someone is close to their goal one month, and fudges something ever so slightly to make it; other people hear about it, and then it is routine. Executives don't care because the numbers look good. Sales people don't care because they are hitting their numbers. Only when an outside force comes along does the house of cards come tumbling down.
- Cactus2018 6y agoExample from Toshiba, discussed a few months ago https://news.ycombinator.com/item?id=24086106 https://news.ycombinator.com/item?id=24086106 https://en.wikipedia.org/wiki/Toshiba#2015_accounting_scandal https://en.wikipedia.org/wiki/Toshiba#2015_accounting_scanda... > It seems that a fictitious transaction was made at the Toshiba subsidiary "Toshiba IT Service", which reminds me of that Toshiba legendary fraudulent accounting. Legendary accounting in which operating income exceeded sales due to over-manipulation of accounting and the wave getting bigger and bigger. https://pbs.twimg.com/media/EOjN_NRU0AEEGUL?format=jpg&name=large https://pbs.twimg.com/media/EOjN_NRU0AEEGUL?format=jpg&name=...
- mathieuh 6y agoHell, I'd bet most developers do something similar. E.g. you're working on a ticket that's estimated for three days and you finish it at lunch time on the third day. Do you immediately ask for more work or do you take it easy for the rest of the day?
- geodel 6y agoYou are right. Specially in today's extreme JIRA culture where a day delay in 2 week work cause projects go red and 3 level reporting need hour long meeting on what's being done to remediate the situation urgently.
- xiphias2 6y agoI don't understand the economics of this decision. BMW investors got screwed even more because some executives were giving them fraudalent information? I understand that it's easier to collect the money from the company, but I believe that public company CEOs should get into prison much more often that they are.
- gogopuppygogo 6y agoRich people don’t go to prison for crime in America. America attracts rich people from around the world. I can’t see the Germans wanting to start the reverse trend.
- gpm 6y agoOr at least fine the people involved in making this decision instead of fining the company.
- kube-system 6y agoI would guess that with something like this (where there is probably a lot of people involved in varying capacities) it's easier to demonstrate that the company as a whole did something wrong than it is to demonstrate that specific people within the company did it.
- 542354234235 6y agoWell that is a problem of the laws themselves. For any sufficiently large company, especially one where the CEO profits privately directly from the company profiting publicly, a portion of that money should be tied to the company directly in terms of liability. You shouldn’t have to prove the CEO was directly involved. At the level they are, the very nature of their position should have some sort of liability in regards to the actions taken by that company under their watch. It should be built into the very regulations and laws. This would hold CEOs accountable for inaction, apathy, or ignorance leading to law breaking within their company, and it would only apply to compensation for managing said company.
- Proven 6y agoAll these old school automakers should learn from Tesla. On how to violate all sorts of laws and get away with it, that is.
- vilifiedtwin 6y agoOne would think that German companies exhausted all their luck, when they didn't even get a slap on the wrist for using forced labour during the WWII. Some didn't even apologize. Yet they still pull some dirty stuff from time to time and still exist on the market... that is a mystery to me.
- known 6y agoAnd the TRUTH is suppressed in the name of loyalty, discipline, patriotism, job security, national security, intellectual property etc