Trust Digest 97b (May 25, 2015)


Wal-Mart is pushing its suppliers to be nicer to animals bred for consumption
Wal-Mart's push to get its suppliers to give farm animals fewer antibiotics and more room to roam is expected to have a big impact on the food industry, experts say.
Key Words: WalMart, Supplier, Antibiotics, Animal Abuse, Shoppers, Change, Fresh Pork
Trust Issues: Customer Trust, Food Safety, Openness, Information Transparency


A New Tool in the Battle Against Patent Trolls: Shame
With a federal crackdown on "patent trolls" stalled, startups and small companies are turning to a low-cost tactic to combat frivolous patent claims: shame.
Key Words: Patent-holding entities, TrollingEffects.org, Startups, Small Companies, Patent demands
Trust Issues: Obtaining Trust, Transparency, Legal Regulation, Work Ethics, Unfair Competition


A Year After Snowden, Tech Companies Are More Transparent
Nearly one year after Edward Snowden leaked documents revealing the extent of U.S. governments electronic surveillance, large tech and telecom firms are telling their users a lot more about the types of data collected by the government, according to a report by an advocacy group.
Key Words: Edward Snowden, Tech Giants, Mass Surveillance, Transparency, Snapchat, User Data
Trust Issues: Data Transparency, Interdependence, Alignment of Interests, Cyber Security and Privacy


Wall Street gets slammed with $5.8 billion in fines for rate rigging
The fines are rolling in for Wall Street in connection with the 2008 LIBOR currency market and interest rate rigging scandal. Six banks have agreed to pay a combined $5.8 billion to the Justice Department and other regulators.
Key Words: LIBOR currency market, Interest-rate Manipulation, Justice Department, Colluding information, UBS, Barclays, Citi, JPMorgan, Royal Bank of Scotland, Bank of America
Trust Issues: Asymmetric Information, Abuse of Corporate Power, Conflict of Interests, Work Ethics


General Motors hit with $3 billion lawsuits over recalls
General Motors has been slugged with a $3 billion lawsuit by the state of Arizona in response to a record number of vehicle recalls linked to safety defects.
Key Words: Arizona, 2.6 million Vehicle Recalls, Safety Defects, GM, Investigation, Penalty Violation
Trust Issues: Quality, Safety and Standard of Production, Consumer Fraud, Work Ethics, Compensation


Chris Christie Vetoes Anti-Corruption Law To Limit Wall Street Campaign Cash
The bipartisan legislation on Chris Christie's desk on Monday was designed to stop New Jersey public officials from delivering lucrative pension deals to their campaign contributors. Gov. Christie vetoed the bill -- at the same time his administration faces a new investigation into New Jersey pension fees paid to financial firms, some of whose executives made contributions to Republican groups backing Christie. The legislation also would have required the pension system to fully disclose all Wall Street fees, a provision Christie said would be "disadvantageous."
Key Words: Legislation, campaign deal, pension, investigation, disclosure, financial firm
Trust Issues: Anti-corruption law, Fund Fraud, Conflict of Interests, Legislature Violation


Los Angeles sues Well Fargo, alleging fraud by employees
Wells Fargo Bank employees driven by strict sales pressure issued unwanted credit cards and opened unauthorized accounts that charged customers fees and damaged their credit, according to a lawsuit filed by the city of Los Angeles.
Key Words: Wells Fargo Bank, complaint, violation, employees, high-pressure, cross-selling, bundling
Trust Issues: Alignment of interests, Work ethics, Information Transparency


The Price of a Boss’s Bad Behavior:$226 Million

Companies have a lot to lose when the boss behaves badly. When a top corporate leader is accused of personal misdeeds ranging from drunk driving to domestic disputes, that company’s market cap takes an average $110 million hit, or 1.6 % loss of shareholder value, according to a new working paper from Mississippi State University, Drexel University and Northern Illinois University. The stakes are even higher when the CEO is in hot water: those episodes result in an immediate loss in shareholder value of 4.1% or $226 million.
Key Words: Boss, Disputes, Performance, Trust, Shareholder Value, Accused, Indiscretion
Trust Issues: Trust, Control, Delegation, Executives Operating performance, Due Diligence


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