Joasia Zakrzewski is a top ultramarathoner.  For those not familiar with the sport, ultramarathoners run 50-miles in their races. In April 2023, during a 50-mile race from Manchester to Liverpool, Ms. Zakrzewski, picked up a ride from a friend for 2.5 miles of that race.  She finished third in the race and accepted the trophy.

However, honesty being what it is these days, race officials conduct post-race audits looking for time anomalies.  A post-race audit allows officials to check the times of the runners between checkpoints.  The audit showed that Ms. Zakrzewski finished one mile of the race in 1 minute and 40 seconds.  That’s a 100-second mile! Quit a clip!  When confronted, Ms. Zakrzewski admitted to accepting the ride and apologized for her mistake in accepting the third-place trophy.

Actually, the apology should have been for going cruising with a friend during an ultramarathon.  The Barometer would have tried to run a marathon had she known of the auto-buddy possibilities. Ms. Zakrzewski denied that she was trying to “cheat” or “conceal the fact that she had traveled in a car for part of the race.” One wonders how the friend happened to be toddling along marathoners that day.

The usual penalty for such a breach of the rules would be a two-year suspension from the sport.  However, Ms. Zakrzewski offered jet lag as a mitigating factor.  The officials of U.K. Athletics bought that defense hook, line, and sinker and gave her a one-year suspension.

The Barometer envisions criminal minds all over the world standing before judges with the jet-lag defense.  “Your honor, I took the red-eye from Paris to New York and the next thing I knew I was robbing a bank.”

Do these runners not know history?  Rosie Ruiz took the subway and won the Boston Marathon, temporarily, in 1980.  In the chutzpah department, Fred Lorz (and race auditors should focus on runners with  “Z’s” in their last names– somewhat of a pattern here) hitched an auto ride for 11 miles of his marathon in St. Louis in 1904. Of course, 1904 autos were not much faster than runners so it took awhile for his mechanical assistance to emerge.  He had a sort of Houston Astros attitude, “It really didn’t help that much.”

So, we are left with the ultimate question, “Then, why do it?”  Establishing intent is actually quite easy.

The sport changes, the decades are different, but the cheating mind works the same. And the sanctions are always light, for whatever reason.

Victor Mather, “Unhappy Hitchhiker:  A 100-Second Mile Leads to a British Ultramarathoner’s Ban,”  New York Times, November 19, 2023, p. A33.

The allegations against the University of Michigan football team are spy-novel worthy.  Allegedly, according to allegations, in great deference to libel and all that suit-worthy stuff, an attache with military experience was dressed not as a Wolverine (not the animal, just the school  colors for Michigan  coaching staff with the obligatory Nike icon),  Allegedly dressed in opposing team garb, he hung around the opposing team as if he was a member of the coaching staff.  Allegedly, no one noticed.  No one’s interest was piqued enough to ask, “Who are you?”

The alleged undercover Wolverine’s  purpose, allegedly, was to gather alleged intelligence on alleged planned offensive plays. Like baseball, gathering intelligence is permitted under NCAA rules only live and in person during an ongoing game. Unlike the NFL, college players do not have helmet equipment that permits coaches to speak to players directly during the game. Hence, alleged cheaters find a way.

Michigan denies the allegations, demands due process, and is shocked, shocked that anyone would think that Michigan Head Coach Jim Harbaugh would do such a thing or even allow such a thing to allegedly happen on his watch.

Nonetheless, a Michigan team analyst has tendered his resignation.  In his alleged resignation letter the analyst  referred to being an alleged distraction. When there is alleged video of alleged said analyst standing around among the opposite team in an earlier game (sunglassed though he was), the other members of the Big Ten are likely to have questions. Why, the universities have drawn on a computer science prof who is an expert in facial recognition.  The good prof says the alleged analyst is “highly likely” the now former Michigan analyst.

Not to worry.  Just like the Johnny-on-the-spot MLB, the NCAA is allegedy conducting its usual five-year investigation. Like MLB, the NCAA will issue a report.  The report will confirm that the alleged cheating did indeed allegedly happen but unlike the ending in Romeo and Juliet alleged Shakespearean  play, none will be punished.

Remember the Astros, allegedly.

Adidas, the athletic shoe and apparel  company, had a decade long relationship with rapper Kanye West (Now “Ye”). West’s shoes in the Adidas line (Yeezys) brought the company a billion dollars in sales.

The relationship ended in October 2022 following Ye’s very public inflammatory antisemitic remarks.  Adidas terminated Ye and stopped selling Yeezys.

What has since emerged is that Adidas tolerated behind-closed-doors conduct of Ye throughout the partnership.  Megan Twomey, “Money, Misconduct and the Price of Appeasement,”  New York Times, October 29, 2023, p. A1.

Here is a list of some of the behaviors Adidas executives and employees tolerated to maintain the relationship with the rapper whose name sold shoes:

1.  In 2013 he required executives to watch pornography in his Manhattan apartment because he told them that it sparked creativity.  That perhaps explains the plastic Yeezy that Adidas designed and released.  The shoes looked like a pair of Crocks that had been run through a shredder.
2. He told a Jewish Adidas manager to kiss a picture of Hitler every day.
3. He disclosed to a member of the  Adidas executive board that he had made a seven-figure settlement with one of his own employees for praising the architect of the Holocaust.
4. His sexually explicit and abusive language resulted in ongoing Adidas employee complaints.

Adidas and Ye signed a new contract in 2016 that included a “moral clause.”  Moral clauses are the means by which companies can rid themselves of spokespersons whose conduct damages the company’s name and/or brand.  Morals clauses have tanked contracts of many celebrities including Paul Deen, Tiger Woods, and Michael Jackson.

After tough negotiations, there was a morals clause in place, but then-Kanye went off the rails.  He made statements that angered and offended even his fans.  Yet Adidas took no action.  Adidas CEO explained on CNBC, “Kanye has helped us have a great comeback in the U.S.  We’re not signing up to his statements.  We’re signing unto what he brings to the brand and the product he’s bringing out.”

In the mean time, Adidas was rotating people who worked with Kanye because of his statements and the toxicity he brought into the company. And the Kanye statements got worse until he posted in October 2022, “death con 3 on JEWISH PEOPLE.”

Finally, Adidas ended the partnership.  Adidas employees said that their executives knew about Kanye’s behavior but had “turned their moral compasses off.” For about a decade.  In the first meeting Kanye had with Adidas executives, they showed him a shoe design for his name.  He took the design photo and drew a swastika on it.  The German executives should have stopped there. Saying nothing only leads to bolder actions.  Eventually the Kanye behaviors went public.  With much consternation, Adidas ended the relationship after saying nothing for far too long.

Oh, and one more thing. Following losses in 2022, Adidas resumed sale of the shoes.  Seems we all have a tolerance level for antisemitism, sexual harassment, and the outrageous when we like the shoes.  Yes, the anti-morality shoe fits.  Wear it with pride.

Home Depot was struggling with inventory shrinkage in St. Petersburg, Florida.  The company realized that to stop such high levels of theft, it needed to figure out who the fencers were.  Fencers are critical for criminal networks.  These networks have their “agents,”  who walk out of stores with merchandise they did not pay for.  But then comes the step of unloading the goods on someone for the cash.  Enter the fencer.

The fencer stores the goods and then uses an eBay account or other online selling mechanism to unload the goods and obtain the cash.  Your run-of-the-mill shoplifter does not have the skills or resources for setting up a fencing operation.  Also, it is highly inefficient to have thieves serve as fencers.  One must devote time to running the fencing operation.  Time spent on this management side takes away stealing time.

The Home Depot in St. Petersburg partnered with law enforcement.  Footage  from the store’s security cameras picked up on two people who were regular customers, i.e., the non-paying kind. The cameras saw the two  walking out with two cordless impact wrenches and cordless die grinders that they had not paid for.

The Barometer has no idea what these tools are, but the price range is $75.00 – $549.00 once one gets into the Milwaukee tool line.

The cameras picked up their vehicle license plate.  Agents from the Florida Agriculture and Consumer Services Department began surveillance of the two.  They always dropped off their “goods” at a garage at the home of one Robert Dell.  Local police then stepped in and got information on Mr. Dell’s eBay account.  Lo and behold, Mr. Dell was selling cordless impact wrenches and cordless die grinders on eBay.

More than that, the police discovered that one of the customers had been “working” (thieving?) for Mr. Dell for five years, along with many others.  She said that she was caught and arrested once and that Mr. Dell posted her bond.

Mr. Dell’s tool line on eBay was but one of the hats he wore.  He was also the pastor at the Rock Community Church and Transformation Center in St. Petersburg.  Perhaps Mr. Dell was really recruiting parishioners for transformation through the operation? He has entered a plea of “not guilty.”

Congress has passed legislation that requires online retailers to collect information on sellers who have 200 or more transactions and make at least $5,000 in transactions in a 12-month period.  Mr. Dell had 10,500 transactions on eBay from January 2020 until May 2023. He netted $1.5 million on those transactions.  Not bad money if you can get your thief ring staffed.

eBay buyers do not complain because they are getting their goods for below retail. Fencers enjoy high ratings on eBay. EBay will flag items identified by retailers as  high-theft goods.  eBay will then ask sellers to verify their sources for those goods. Mr. Dell showed up on eBay’s radar in 2017, but it was not until Home Depot worked with law enforcement that the pieces were pulled together.

What we do learn?

Retailers need to collect data on their regular shoplifters so that the fencers can be found.  Once you have the fencers, you can bust up the theft rings.  You find fencers in the most benign places.

Congress needs an education on multiple seller accounts on eBay — these clever knaves will find a way around the $5,000/transaction numbers by creating different accounts. Then we will need legislation limiting the number of eBay accounts.  The criminal mind has no limits.

It would be difficult to find a professor in the field of business ethics who had not cited her research.  Francesca Gino, a Harvard professor, gave us the studies with results that businesses put into practices.

Her research concluded if you have folks sign an attestation of truthfulness on insurance forms at the top instead of the end, they are more honest in their responses. Another study concluded that having folks read the Ten Commandments before a test makes them  more honest.  The research did not include a warning of EEOC wrath that would would result from forcing a tenet of Christianity on test-takers.

Dr. Gino, along with co-authors, including Dan Ariely, burst onto TED talks, best-seller lists, and speaking tours with their nouveau science.  They were mixing behavioral research with economics to provide insights into decision-making processes.

Two years ago, Harvard received a notice from Data Colada, the blog that checks social science research for its validity.  The blog concluded  that there was fraud involved in the Gino research.  Gino denies the allegations.  Dr. Ariely is even more adamant that there is no fraud.  Noam Scheiber, “A Dishonesty Expert Is Labeled a Liar,” New York Times, October 1, 2023, p. A1.

Nonetheless, the bloggers found evidence that the data had been tampered with to make the results more impressive.  They also found that the data had been moved around to support the hypotheses of the research and articles.What we don’t know is who fooled around with the numbers.

Harvard investigated for two years, Dr. Gino is on leave, and she has filed a defamation suit against both the bloggers and Harvard.   There are so many folks involved in a single academic research project and resulting publication that “whodunnit” may be a terminal cold case.  There can be a dozen co-authors and heaven only knows how many grad assistants processed the data.

Nonetheless, the research conclusions published are not accurate.  That we even have a blog called “Data Colada” staggers the imagination. There have been 5,500 faculty publications retracted in 2022.  In 2002, there were 119.  Granted, we have more tools for detecting, analyzing, and reporting.  The bottom line is that one simply cannot trust social science research. Nidhi Subraraman, “Debunkers Bust Bad Scientists,” Wall Street Journal, September 25, 2023, p. A1.

The former president of Stanford, Dr. Marc Tessier-Lavigne,  left his position after PubPeer (yet another site that dissects research) criticized the data in his publications.  After a Stanford investigation, three of his studies were retracted.

These publications are peer-reviewed — those who know research and the field are supposed to catch flaws.  The Barometer has a skeptic screen:  If what the author [s] (often a dozen or so) concludes gives you a, “How could they possibly know that that from this study?”  then full speed ahead on applying those fraud detection skills.  In reporting the Ten Commandments study, the Barometer has added, “It remains unclear how you detect the honesty of those filling out the claim forms unless you had access to insurance company files and cases.”  The privacy aspects alone also stagger the imagination.

We now have professors whose expertise is actually fraud detection — in any field.  In short, the gatekeepers are slopp so entrepreneurial academics are doing their jobs.

Fun conclusions that make the news are good for authors, their institutions, news, and online hits, likes, and comments.  But fun conclusions do not a body of research make.  There is an old saying that my first department chair shared with me, “Figures don’t lie.  But liars do figure.”

There was another saying that a senior attorney gave to me during my first summer clerkship while in law school.  He had found a typo in a brief I had written.  I had corrected the typo in reviewing the hard-copy draft, but the mag card operator had neglected to enter it.  If you don’t know what a mag card is, tromp down memory lane on the history of technology and word processing. His response to me was simple, “Is your name on this brief?”  It was.  He then said, “Then it is your mistake.”

So it is with the long line of academic researchers.  They may be able to transfer blame and action to others but their names are on it.  Taking responsibility and self-correcting is always an alternative to defamation suits.

The former CEO of BP, Bernard Looney, resigned unexpectedly from his position at the company.  There had been some allegations that Mr. Looney had been involved in inappropriate relationships with colleagues.  The BP board reviewed the allegations and concluded that there were no violations of the BP code of ethics.  Mr. Looney could stay aboard.

However, following that finding, additional allegations emerged.  The board then released a statement, “Mr. Looney has today informed the company that he now accepts that he was not fully transparent in his previous disclosures.” Effective immediately, Mr. Looney was gone. Do you just love that Mr. Looney did not say that he in fact had those relationships.? His only admission was that he accepts the board’s definition of transparency about the relationships.  The technical term for what Mr. Looney has done following his non-admission admission is weasel.

How many times must we live through these lessons?  When it comes to office relationships, two words should do it, “Stop that!”  And another piece of advice:  Don’t try to hide those relationships, don’t lie about those relationships, don’t resort to analysis of the code of ethics to see if you violated the terms of your contract, and don’t apologize for the lack of transparency.  These relationships of CFOs are wrong, wrong, wrong, wrong.  Lying about them is crazy  No, No– lying about them is actually [L]ooney.  Jenny Strasburg, “BP Chief Quits Over His Past Relationships with Staff,” Wall Street Journal, September 13, 2023

“It takes a long time to turn a big ship.”  No dispute there, but Wells Fargo’s fake-account scandal exploded in September 2016.  There should have been some slight tacking.

However, Wells, whose stock has declined 15% since the 2016 shock (other banks’ stock prices have grown exponentially, with some doubled in value), still misses internal control issues, such as employee fraud in checking cashing and clearing. When it comes to self-assessment of risk, Wells, well, does not seem to get it.

Wells has employees meeting daily, virtually and in-person, to review risks and proposals for eliminating those risks.  Still, Wells missed that fraud issue despite all the efforts. And the U.S. Comptroller of  Currency has already indicated that the best way to fix big banks such as Wells may be to break up those big banks into smaller banks where problems emerge more quickly and can be remedied.

The problem at Wells is and always has been its culture. Culture change is a tough slog.  It would not be unusual for a culture change to take five to ten years.  However, if there is no visible difference in seven years, i.e., the ship is not tacking, then the problems lie with the leaders.

Issues such as incentives, disciplinary processes, terminations, turnover, promotions, demotions, and consistency in all of the previous areas are critical.  Employee risk assessment groups cannot trump what employees see happening to them and their colleagues.  Wells has a soft skills problem and it has been trying to solve it with a rote, mechanized process.  Internal controls do not a culture make.  Internal controls are late-catches for bad behaviors.  Root out the bad behaviors and you may see some tacking.

AI gives high school students the opportunity to have someone else write their college admissions application essays for them.  Avoiding writing seems to be the goal for those who seek a college degree.  Ironically, one of the successful programs launched for inmates has been one in free writing.  The inmates sit down with a former prosecutor who encourages them to write. One inmate explained, “I just let whatever goes through my mind go on the paper.  That’s where the magic happens.” It sure does.

Writing demands introspection, attention, reasoning, concentration, patience, learning, insight, and all of these over and over again.  Tragic that the high school kids try to avoid it as those with fewer opportunities recognize its power and their need to just do it.

There is some critically acclaimed material coming out of the prisons.  Along with the writing success, there is something else emerging from the prisons:  reclaimed lives and reformed individuals who can now see the world is their oyster.

Ernesto Londono, “Finding Clarity and Inspiration in Writing, While Incarcerated,” New York Times, September 8, 2023, p. A12.

Eddie Bauer was sued by a consumer who paid $6.00 for a pair of leggings originally priced at $12.50. The consumer discovered that the original price was not $12.50, but much less. An Amazon customer complained that a $114.99 vacuum seller changed its list price to  $249.99.  The seller  then reduced that price to $189.95 for two days.  After that “special sale price,” for two days only,  the seller changed the price back to $114.99.  Amazon says that it now has a system for monitoring such practices. Patrick Coffee, “Stores Accused of Fake Sales,”  Wall Street Journal, August 24, 2023, p. B5.

Known as “fake sales,” retailers are using the tactic more and more as consumer purchases decline. The Federal Trade Commission does not dabble in pricing guidelines.  The states do the regulating of fake sales, and not much regulation is taking place there.

Consumers have been filing suit against the sellers  who inflate original prices to lead customers to believe there is a sale item. However, a recent dismissal of such a case has put the kibosh on these class actions.  The judge dismissed  the suit against Eddie Bauer for the $6.00 leggings because plaintiff purchaser could not show any harm.

So, the risk of being caught is small.  Now the risk of having to pay any damages has been reduced as the suits go nowhere.  However, the retailer gains market share and revenue boosts.  To the retailers it is worth the risk to look better financially, at least on paper.

There is always a way to game the system.  The law may not cover the situation, but ethically speaking???

We just don’t know how much inventory has been stolen from retail stores.  The reason we don’t know is because retailers are using euphemisms to describe what is really happening.  Their financial reports disclose that retailers are experiencing higher “shrink.”  But “shrink” can mean loss of inventory value, as when you have increasing difficulties moving those Pelotons out the door unless you slash the price.  Your inventory value of your Pelotons is cut in half. “Shrink” could also mean that goods were damaged in transit.

What retailers are not saying is that shoplifting, smashing and grabbing, and, well, stealing, are on the rise.  There is “organized retail crime,” not “shrink.  However, the retail stores do not wish to offend.  After all, it is their vault those designer bags, wallets, and belts are needed for going out shopping for food.

Retailers say little because they do not wish to offend.  They just bemoan their inability to to take off the financial pressure of shrink.  It would be better to bemoan the fact that their “shrink” will not end any time soon.  That’s because no one who is stealing, shoplifting, and smashing and grabbing is being arrested.  We watch them on videos each night.  One shoplifter this week dragged out the entire display stand to which the designer bags, which were being stolen, were hooked.  How hard can it be to walk down the street and find a 30-year-old man wandering the streets pulling a Nordstrom display case who is looking for wire cutters?

In the so-called “steal the exam” scandal, the federal government prosecuted a former KPMG audit partner as well as an official with PCAOB (the federal government regulator of audit firms that audits publicly traded companies). They were convicted or settled their cases.

KPMG had not been doing so well on its audit quality scores from PCAOB.   So, KPMG got to work and made contacts with PCAOB employees to obtain critical information: Which company audits that KPMG had done would PCAOB review? Some PCAOB employees cooperated with KPMG and later got KPMG jobs.

What KPMG and the PCAOB employees did was just plain wrong.  But, it was not criminal.  The U.S. Supreme Court, and federal district and appellate courts following the high court’s lead, have been curbing the use of federal fraud statutes to prosecute conduct that do not fit the crime’s elements.

Wire fraud charges must involve some type of conduct that deprives someone of property or money. Deception, corruption, and abuse of power are wrong, but do not fall under federal fraud statutes. Several of the parents in the Varsity Blues admissions scandal had their convictions reversed.  Why?  The Fifth Circuit appellate court held that admission to a university is not property. Dave Michaels, “New Definition of Fraud Derails High-Profile Cases,” Wall Street Journal, August 4, 2023, p. B10.

So, the prosecutors in the KPMG case have admitted that they were wrong. The charges have been dropped.  So, when Dave Middendorf, a KPMG audit partner, said at his sentencing hearing that he never imagined that what he was doing was wrong, he was correct.  At least in a criminal law sense.  What Mr. Middendorf  did was unfair, deceitful, and corrupt.  He damaged the audit profession and chipped away at the trust needed in economic systems.  Cheating isn’t always criminal. If it were, by latest stats, 90% of college students would be in jail.

Ethics play a critical role in society. Not every rotten, dirty trick can be criminalized.  Enter ethics. Ethical standards offer some semblance of fair play. Without them society and the economy are the lesser as cheaters run free, happy, and unaccountable in search of another way to game the system without dipping a toe into fraud.

If true, the details on the hazing in the football and baseball programs at Northwestern are deeply troubling.  How many times must we live through these college sports debacles before university presidents realize that college athletic programs are to colleges and universities what wealthy clients are to banks and toddlers around swimming pools are to their mothers?  You watch them all the time and you never leave them unattended.

Perhaps more stunning is the difference in experiences of those who were part of the athletic department.  Some saw nothing and others saw players forced to practice au buffo.  If witnesses were uncomfortable raising the issues related to nakedness, they could have hung their hats on  the legal liability of players practicing without padding.

Perhaps most stunning is that Northwestern was aware of the allegations in November 2022 and took no action until July 2023. In the interim, alumni were filing lawsuits and even the student newspaper was cracking the case wide open.

Northwestern’s brand spanking new president is slow on the uptake.  He has offered that there was a culture driving the behaviors.  The only cure for a culture is cleaning the leadership house along with a good portion of those aligned with them. The football coach is already gone following a bone-chilling two-week suspension (?????). He is lawyered up because $5 million per year is a tough gig to lose. And all this before the new president even had a chance to take off his cap and gown from his inauguration ceremony.

Therein lies the lesson for all college and university presidents — never mind the pomp and circumstance. Assume chicanery is afoot.  Forget the faculty and alumni donors.  Heigh thee down to the field house, stadium, or locker room for a surprise visit or two.  Oh, the things you will see, and the fixes you will need.

Dana Goldstein and Billy Witz, “Accusations of Abuse and Racism Plague Northwestern,” New York Times, July 30, 2023, p. A28.

A new study reveals the following about the recall of medical devices and the behaviors of their CEOs:

The greater the level of stock ownership by the CEO, the longer the delay in issuing the recall for the medical device

The greater the defect in the medical device, the longer the delay

The greater the delay in recalling the medical device, the more the stock market punishes the company

While it is true that the delay could be the result of trying to determine the root cause of the defect, the studies offer the wisdom of the ages:  If a company has bad news, take your pain:  Get the information out there and get it over with.  With medical devices, the motivation to disclose early and often should be paramount because lives and health hang in the balance.

For board members, watch the CEO’s stock ownership and review and discuss delay risks in recalls.  And it must follow, as the night the day, the market punishes the stock of companies with recalls, as it should.  However, wait too long and the market punishment is greater because the market punishes for lack of trust and not just the  costs and litigation that come with product defects.

Jessica Darby, David J. Kitchen, Jr., George P. Ball, and Ijjal Mukherjee, “CEO Stock Ownership, Recall Timing, and Stock Market Penalties,” Manufacturing & Service Operations Management (2023),

The NCAA found that the University of Tennessee gave $60,000 of forbidden benefits.  Those benefits included $5,000 and $6,000 payments to the parents of football players.  The former head coach of the Titans also worked with others in the Athletic Department to camouflage those payments. There were also 110 impermissible hotel nights and 180 impermissible meals.

As bad as all that sounds, the NCAA opted not to impose a ban on the team’s participation in postseason bowl games.  Crediting “exemplary cooperation” by the university, the NCAA fined the university $8 million and banished the former coach from coaching positions for six years. UT lost 28 scholarships but was credited with 16 scholarship reductions the university had imposed as a self-punishment.

So the lessons learned?  Be really sorry.  Be really cooperative with the NCAA.  And get ahead of the curve with your own self-imposed sanctions and you skirt the big kahuna of penalties — post-season play.

Accountability used to involve more pain.  Now we have it down to formulas that avoid doing what schools fear most.

Santa Neckar, “N.C.A.A. Gives Tennessee $8 Million Fine for Skirting Rules, but Not a Bowl Ban,”  New York Times, July 15, 2023, p. B12.