Texters, e-mailers, Blackberryites, and iPhone users – Beware! We can tell what you were doing and when you did it.
First, there is the sad tale of the texting engineer. Just seconds before the fatal collision of a Los Angeles commuter train with a freight train, the commuter train’s engineer sent a text message. Engineer Robert Sanchez received a text message at 4:21:03. He sent a text message at 4:22:01. The crash occurred 22 seconds later.  
The The last text was received at the same time the train would have been passing the red warning light that was flashing to indicate the approach of the freight train. Sanchez, who was killed in the crash, had received 7 text messages and sent five from the time he began his shift at 3:03 PM. Earlier that day, on his morning shift, Sanchez had received 21 text messages and sent 24 (from 6:44 to 8:53 AM). The railroad, Metrolink, prohibits its employees from receiving or sending text messages when they are on duty.Â
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Then comes the tale of woe of former UBS general counsel, David Aufhauser. Mr. Aufhauser has agreed to ante up his entire bonus package for 2008 — $6,000,000 in scratch and a $500,000 fine to boot – to settle insider trading charges. On December 14, 2007, Mr. Aufhauser received an e-mail whilst riding the Amtrak from New York to Washington. The e-mail was from the chief risk officer at UBS and described trouble in the auction-rate securities market; trouble that UBS had not yet made public.  Within minutes, Mr. Aufhauser sent an e-mail to his personal broker that read, “I want to get out of A.R.C’s (auction rate certificates) – let’s talk on Monday.â€[1] Three days later Mr. Aufhauser told Marten Hoekstra, the head of UBS Wealth Management, at a UBS holiday party that he selling the A.R.C. securities. Mr. Hoekstra assumed that Mr. Aufhauser was kidding. However, Mr. Aufhauser sold $250,000 of A.R.C.’s from December 17-December 27, 2007. Combine e-mail with cocktail conversation and sales and you can build a fairly good case of insider trading. Mr. Aufhauser neither admitted nor denied guilt, but he is banished from the securities industry nationwide for two years, prohibited from practicing law in New York for two years, and not permitted to be an officer or director of a publicly traded company for two years.Â
Electronic communication is fabulous, but it knows what you said and when. Ah, how truth percolates.Â
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[1]
Lynnley Browning, “Ex-UBS Counsel to Pay $6.5 Million to Settle Auction-Rate Trading Case,†New York Times, October 8, 2008, p. B6.
About mmjdiary
Professor Marianne Jennings is an emeritus professor of legal and ethical studies from the W.P. Carey School of Business at Arizona State University, retiring in 2011 after 35 years of teaching undergraduate and graduate courses in ethics and the legal environment of business. During her tenure at ASU, she served as director of the Joan and David Lincoln Center for Applied Ethics from 1995-1999. In 2006, she was appointed faculty director for the W.P. Carey Executive MBA Program. She has done consulting work for businesses and professional groups including AICPA, Boeing, Dial Corporation, Edward Jones, Mattel, Motorola, CFA Institute, Southern California Edison, the Institute of Internal Auditors, AIMR, DuPont, AES, Blue Cross Blue Shield, Motorola, Hy-Vee Foods, IBM, Bell Helicopter, Amgen, Raytheon, and VIAD.
The sixth edition of her textbook, Case Studies in Business Ethics, was published in February 2011. The ninth edition of her textbook, Business: lts Legal, Ethical and Global Environment was published in January 2011. The 23rd edition of her book, Business Law: Principles and Cases, will be published in January 2013. The tenth edition of her book, Real Estate Law, will also be published in January 2013. Her book, A Business Tale: A Story of Ethics, Choices, Success, and a Very Large Rabbit, a fable about business ethics, was chosen by Library Journal in 2004 as its business book of the year. A Business Tale was also a finalist for two other literary awards for 2004. In 2000 her book on corporate governance was published by the New York Times MBA Pocket Series. Her book on long-term success, Building a Business Through Good Times and Bad: Lessons from Fifteen Companies, Each With a Century of Dividends, was published in October 2002 and has been used by Booz, Allen, Hamilton for its work on business longevity. Her latest book, The Seven Signs of Ethical Collapse was published by St. Martin’s Press in July 2006 and has been a finalist for two book awards.
Her weekly columns are syndicated around the country, and her work has appeared in the Wall Street Journal, the Chicago Tribune, the New York Times, Washington Post, and the Reader's Digest. A collection of her essays, Nobody Fixes Real Carrot Sticks Anymore, first published in 1994 is still being published. She has been a commentator on business issues on All Things Considered for National Public Radio.
She has served on four boards of directors, including Arizona Public Service (1987-2000), Zealous Capital Corporation, and the Center for Children with Chronic Illness and Disability at the University of Minnesota. She was appointed to the board of advisors for the Institute of Nuclear Power Operators in 2004 and served on the board of trustees for Think Arizona, a public policy think tank. She has appeared on CNBC, CBS This Morning, the Today Show, and CBS Evening News.
In 2010 she was named one of the Top 100 Thought Leaders in Business Ethics by Trust Across America. Her books have been translated into four different languages. She received the British Emerald award for authoring one of their top 50 articles in management publications, chosen from over 15,000 articles.
Personal: Married since 1976 to Terry H. Jennings, Maricopa County Attorney’s Office Deputy County Attorney; five children: Sarah, Sam, and John, and the late Claire and Hannah Jennings.
