Daily Archives: July 21, 2011

Following the threads

Readers sent along several links for suggested reading yesterday.

First: A jury awarded $930,000 last year to a female barn manager who said she was fired and thrown out of her house by Kimberly Dey in 2008 in retaliation for complaining about sexual harassment at a Waimanalo ranch owned by Dey.

Dey is now an advisor to Aina Koa Pono, which has the backing of Hawaiian Electric to build a $350 million biofuel processing plant on the Big Island, a key part of HECO’s plan to expand the use of renewable sources of energy. She is the daughter of billionaire businesssman Charles B. Wang.

According to the website, Verdict Search:

Gall was employed for nine years by Kimberly Dey, owner of The Funny Farm Inc. For the last seven years, Gall and her family resided on the 14-acre horse farm located at 41-723 Kaulukanu St. in Waimanalo, in a house provided rent free as part of her compensation. The male employee who tried to kiss her lived in a separate house on the property.

Following the incident, Gall contacted Dey and reported that she was sexually harassed by a male employee. On March 31, 2008, Gall was called into Dey’s office and given a termination letter. She was also ordered to get her family and all of their possessions out of the house by 5 p.m. that day. Security guards were posted.

Gall sued Dey, individually, and The Funny Farm, as a corporation, for retaliation in violation of Hawaii law.

KITV reported:

“I said, ‘Can we talk about this?’ and she said, ‘No.’ Just plain out I was fired and I had three hours to get off the property,” Gall recounted.

“I said, ‘Where am I going with my two kids and my husband in three hours?’ and she simply turned to me and said, ‘I do not care.'”

Meanwhile, a Star-Bulletin business writer pointed me to an April 2001 New York Times story by Alex Berenson alleging fraud at Computer Associates, the company co-founded by Dey’s father, Charles Wang, back in the 1970s that eventually made him a billionaire.

In an email, my friend wrote:

Nice to think of Computer Associates again; their fraud and cover-ups led to one of the most outstanding and inspiring stories I have read (probably because I’ve long had an interest in accounting as well as writing) This story by the NYT’s Berenson in early 2001 also was a big reason why I left the weak news industry here, though it took several years to get the ball rolling.

Berenson reported:

But much of the growth that has enriched Mr. Wang was a mirage, according to more than a dozen former employees and independent industry analysts.

Computer Associates, they say, has used accounting tricks to systematically overstate its revenue and profits for years. The practices were so widespread that employees joked that C.A. stood for ”Creative Accounting,” and that March, June, September and December, when fiscal quarters end, had 35 days, giving the company extra time to close sales and book revenue.

While reporting rising revenue and profits to Wall Street, Computer Associates has infuriated clients with high prices and poor technical support. Its heavily marketed efforts to diversify out of the mainframe business have been a painful failure, former employees and customers say.

Over the years, it has gained a reputation as a callous employer that dismisses workers without warning while top executives take home eight- and sometimes nine-figure pay packages.

It’s quite a read. Two top executives of the company were subsequently indicted in 2004 for their roles in an alleged long-running accounting fraud. The two pled guilty in 2006.

Wang was not charged in the case, but a report issued by the company in 2007 portrayed him as the mastermind of the scheme, according to the NY Times. Wang strongly denied the allegations.

Berenson again reported:

Mr. Wang created a “culture of fear” at Computer Associates — now called CA — and deliberately put inexperienced executives in senior positions so that he would have more control, according to the report. He discouraged executives from meeting with each other and arbitrarily fired managers or employees who disagreed with him.

“Fraud pervaded the entire CA organization at every level, and was embedded in CA’s culture, as instilled by Mr. Wang, almost from the company’s inception,” the report said.

I haven’t found a copy of the company report, but perhaps someone else can track it down.

The case is now the stuff studied in business school classes.

I caught this little comment at the end of an article by the Wharton School of Business.

Documents filed by the SEC and Justice Department show that the timing infractions at Computer Associations required the participation not just of a few top executives but of many people, including lower level people in sales. The government also alleges top executives clearly knew what they were doing was wrong and went to great lengths to cover up. Obstruction of justice is among the charges against Kumar and Richards.

How does a clearly improper practice become so firmly rooted? In many cases, says Thomas W. Dunfee, professor of legal studies and ethics at Wharton, “the organization’s values have evolved in such a way that they are perverse when they are objectively viewed from outside … Sometimes you have companies that start getting an adversarial view of the world.” In addition, Dunfee notes, studies have shown that “people who have been with an organization longer tend to see the organization’s values as compatible with theirs.

“I don’t think that anybody actually sets out to establish evil norms,” he adds. “It’s just that they develop ways of looking at things where they frame issues in a way that ultimately becomes more and more incompatible with the outside world.”

Finally, someone else called my attention to a story I wrote about Hawaiian Electric back in 2001. To be honest, this had completely slipped my mind. But here’s a link to the story in the Weekly’s archives (“HECO: Wired to the past“).

The Apple Genius was stumped again

My computer, a 15 MacBook Pro that is just about a year old, is back in Apple’s Kahala spa for another try at repairing its mystery ailment.

For the second time in less than two months, it has been refusing to boot past the blue startup screen.

More puzzling, it fails to boot from an external drive, which would be a usually part of the diagnostic routine. I tried it at home, and was glad that it still refused to cooperate when we were at the Genius Bar in the Apple Store yesterday morning.

I bought this as a refurbished model, almost new and with a full Apple warranty. It’s had “issues”. The motherboard was replaced in January, it refused to boot in May and was returned “fixed,” and then the blue screen issue started intermittently right away.

In the last week, I’ve been able to boot in what Apple calls “safe mode,” but could not get past the blue screen otherwise.

Diagnostics on the internal drive returned no errors.

I’m interested to see what the diagnosis turns out to be this time around.