This is not particularly surprising, and the story won't go anywhere, but it's pretty amusing. Technically now, you can trace money the Kochs made dealing with rogue state Iran and trace it all the way to funding training for Tea Party patriots. Kind of makes your head spin, or your stomach sick, or maybe you will just giggle. The Kochs are not very good Americans in any event, at least in my book. http://www.bloomberg.com/news/2011-10-02/koch-brothers-flout-law-getting-richer-with-secret-iran-sales.html "Koch Brothers Flout Law Getting Richer with Secret Iran Sales" In May 2008, a unit of Koch Industries Inc., one of the world’s largest privately held companies, sent Ludmila Egorova-Farines, its newly hired compliance officer and ethics manager, to investigate the management of a subsidiary in Arles in southern France. In less than a week, she discovered that the company had paid bribes to win contracts. “I uncovered the practices within a few days,” Egorova- Farines says. “They were not hidden at all.” She immediately notified her supervisors in the U.S. A week later, Wichita, Kansas-based Koch Industries dispatched an investigative team to look into her findings, Bloomberg Markets magazine reports in its November issue. By September of that year, the researchers had found evidence of improper payments to secure contracts in six countries dating back to 2002, authorized by the business director of the company’s Koch-Glitsch affiliate in France. “Those activities constitute violations of criminal law,” Koch Industries wrote in a Dec. 8, 2008, letter giving details of its findings. The letter was made public in a civil court ruling in France in September 2010; the document has never before been reported by the media. ... The article continues from there. Basically, as you can see, it will be hard to pen anything directly on the parent company, which is why good US Americans always open foreign subsidiaries to do their dirtiest work.
It's a hugely long article but worth reading - the most headline grabbing item is the Iran one - so the libertarian patriot Koch brothers were using foreign subsidiaries to send chemical engineering equipment to evade regulations on commerce with Iran a few years after Bush denounced them as the Axis of Evil. It calls into serious question the assertion I've heard on this board of the Koch brothers running an extremely ethical company - stuff like the above and foreign bribery appears to be rampant (and documented pretty exhaustively in story, I have the print version).
So Koch Industries hired someone to dig for dirt on themselves, found some real issues from 6 years ago, and turned themselves in. I still say they're the most ethical corporation I've ever worked for. This reinforces it.
I meant 6 years before the investigation. The bribes happened 9 years ago, and were uncovered by the company 3 years ago.
So do you believe ACORN is a highly ethical organization since they are the ones that turned in the voters' names that were fraudulent in voter registration drives? I don't remember you applauding them and saying that the fact that they investigated names on the lists of volunteers and turned them proved they were ethical.
that's not even remotely close to what happened at all with respect tot he Iran deal - they (like Halliburton in Iraq before it) deliberately engaged in a series of transactions to evade regulations against doing business with Iran - that was a calculated corporate strategy, and can't be (and has not been, by the company itselff) couched in terms of some random actions of rogue employees. And btw hiring a law firm to do an internal investigation of bribery is pretty much par for the course for everey company that gets caught with its hand in the cookie jar, whether be the product of monumental top down corruption or pure innocent mistake, so it's pretty silly for you to draw conclusions on that fact alone.
They weren't caught with their hand in the cookie jar. This was on no one's radar before they brought it to the French government's attention. They caught themselves, turned themselves in, and paid a penalty for it.
On the Iranian deal, they are firmly free-traders. They've always said that. And they did nothing illegal.
And as I said before, that's pretty mcuh always the way it happens whenever there is corruption regardless of culpability and doesn't make them unique in any way. LOL, wnes I can set up a foreign LLC to import cocaine & snuff films in the US and can argue that "I" am doing nothing illegal but it's ethically no different than what the Koch brothers did...which is probably why they don't do it anymore. Maybe it's time to retreat from your claims just a bit rather than continue on with this charade, no? It takes some pretty deliberate intentions to create a network of subsidiaries to evade OFAC & Treasury regs on dealing with rogue states & the like, and "well we're free traders!" is pretty much deserving of eye-rolling and riducule.
wes, you've obviously had more direct experience with this organization than I have (I've had zero direct dealings, of course.) But couldn't I say that, even if you worked with Koch Industries constantly, it would be like judging the entire US government based on working with one office of one branch (like a local post office, or in my case, say, working on a DARPA or NSF grant)? If I really like my NSF program and program officer, I probably shouldn't make any conclusions about the Whitehouse directly, if this analogy holds water. Meaning, since the Koch enterprise is SO huge, how can you make a sweeping "ethical" statement about them after having had some dealing with just one limited portion?
Except that the managers that I knew shutdown a plant that I worked for because it might have been in violation of an operating permit if you had interpreted some language differently than it had been when the previous owners, the Huntsmans, had owned it. (An interpretation that the Texas environmental regulators ended up telling them that it was more conservative than any they had ever heard.) Those managers worked directly with the Koch brothers on a regular basis. (It's a very flat company for its size.) They talked about how the Kochs demanded compliance. It is possible that they are completely two-faced about it, and managers in 90% of the business are beaten up with a compliance culture, and 10% are pushed to bend and break laws, but I doubt it seriously. I doubt your theoretical postmaster or NSF guy ever sniffs the White House. I had other problems with Koch. They are very suspicious of implementing new technology, and reliability is way more important to them than efficiency, and it really hampered me with the job I was doing then. But as a corporation, they are noticeably more ethical than Sears, ExxonMobil, CITGO, Praxair, or CB&I; and way, way more ethical than Huntsman. (Those are the other major corporations that I've worked for.
Very good point. As an employee of a massive company, I can quite clearly state that the above is right on target.
Apples and bowling balls. Your LLC is breaking the law in the United States. Their company was neither breaking the law in Germany, where they were making and selling the distillation trays, nor in Iran, who was buying them.
My non-US incorporated LLC is not breaking the law in the U.S - I can very easily construct a series of entity-related firewalls to prevent any entity liability there, just as the Koch brothers did. But it's good to see that your "ethics" argument now hinges on the state of incorporation of the artifices constructed in order to evade liability....heh.
You still set up a corporation to do illegal activity, something the Kochs never did. Since you need simplistic analogies, it would be like deciding that a Canadian company that you already owned should start importing Cuban cigars and Cuban rum to Canada. Unless your version of ethics includes forcing the whole world to obey US trade law, there's nothing unethical about that.
actually the claim is they did set up a coporation to do illegal activity or at least to skirt us laws. they couldn't deal with iran, so they set up a company that could and made sure that the us companies had no involvement. also, in your defense of sending the complience officer, the article later claims that she wasn't sent for that and stumbled on the bribes in another investigation. and she claims she was fired for that reason
Actually I wouldn't be surprised if they did set up several new entities - in fact I'm sure they did at least ont eh Iran end, it's a routine occurence. Why is this the ethical distinction? Using a previously existing subsidiary to circumvent laws is not unethical, but establishing a new one to do so is? Stop digging.
