It is sometimes possible to give creativity its due, even when one takes issue with its results. Thus, when a 49-year-old Scot turns from crack addict to designer drug entrepreneur with the help of a pharmacologist, he merits a certain grudging acknowledgement for shrewdness in staying out of jail by selling drugs that are not yet illegal.
What does he do? He synthesizes drug knock-offs that are not technically illegal yet produce effects drug buyers desire. Evidently, Belgium offers an attractive base of operations for his business, according to the Wall Street Journal (http://online.wsj.com/article/SB10001424052748704763904575550200845267526.html?mod=WSJ_hpp_editorsPicks_3) Thus, it is the likes of David Llewellyn we have to thank for expanding the lexicon of recreational drugs with street names like Meow Meow and Nopaine. Indeed, Llewellyn boasts that Nopaine, a modified version of the attention-deficit drug Ritalin, serves as a working substitute for cocaine in its look and feel. Meow Meow, on the other hand, also known as Mephedrone, M-cat, and Drone, is an amphetamine surrogate.
Why Belgium? Evidently, Europe in general is a more friendly incubator for designer drugs because authorities lack the wherewithal to ban them or interdict their legal distribution before their purveyors realize substantial profits. Next stop? The United States – at least, for the gray area-drugs that can attract customers and outpace law enforcement.
Still, innovation in one area often inspires innovation in another. What are the Belgians doing to counter Llewellyn’s innovative synthesis of chemistry, legal hair splitting, and drug pushing? They are using different laws to shut him down, raiding his facilities on the basis of environmental law infractions and confiscating laboratory equipment for which he lacks the proper professional license. Who says bureaucracy cannot occasionally offer value elsewhere unavailable? Bravo, Belgium, for seeing to it that chemistry and law not only collude but collide.
-- Nick Catrantzos
Saturday, October 30, 2010
Friday, October 29, 2010
Curse of the Indelicate Obvious
There is a modern curse more deadly to the secure enterprise than a squadron of scoundrels. What is it? The curse of the indelicate obvious, or the intentional denial of blatant indicators that something is amiss, for fear of running afoul of some perceived standard or arbiter of unfairness. Common sense is a great boon to protection, and it is a mistake to dismiss it out of fear of defamation suits or grievances. Consider: Should a financial institution hire into a position of trust someone whose personal credit is in disarray or who was previously convicted of fraud? Common sense says no. But moral outrage expressed by the applicant’s champions could easily browbeat the faint of heart into negating this reasonable protective decision.
Similarly, a wise employer realizes that it is generally a good idea to avoid hiring people whose behavior indicates that they treat the workplace as a platform for self-expression at employer expense. What are the clues? Blogs and social media postings highlighting indiscretions or even boasting about converting employer assets to personal gain or about threatening bosses with intimidation tactics or even physical harm.
While the front-line supervisor knows that ignoring such signs means paying for them later in lost productivity or work team disruptions, support staff often present a different perspective. Theirs is the world of hierarchical harmony and avoidance of legal, public relations, and reputational risk – all worthy objectives. However, one may as well fall flat on his face as bend over too far backwards. In their eagerness to avoid bad press or unpopular contests, these staff advisers tend to counsel too much caution, advising that no line manager ever act on any clues other than what exists in a given box of the job application. This is what John Steinbeck would have called the kind of smartness that cuts its own throat.
The solution? Don’t over rely on imperfect indicators like gut feel and questionable signs of irresponsibility, but don’t ignore them altogether either. Instead, use them to trigger a supplemental probe. Even if your staff advisers tell you that you cannot base a hiring decision on overabundance of body piercings or blatant indicators of irresponsibility, you can at least schedule a follow-up interview to ask questions and draw a person out. At the very least, ask. Offer the candidate some scenarios that compel choosing a course of action consistent with future job responsibilities. You might be surprised how often people admit to misdeeds or give themselves away through behavioral leakage – if you just give them a chance.
For more along these lines, see “Defending Against the Threat of Insider Financial Crime,” on page 17 of a recent issue of Frontline Security (at http://www.frontline-security.org/publications/10_SEC2_Money.php).
-- Nick Catrantzos
Similarly, a wise employer realizes that it is generally a good idea to avoid hiring people whose behavior indicates that they treat the workplace as a platform for self-expression at employer expense. What are the clues? Blogs and social media postings highlighting indiscretions or even boasting about converting employer assets to personal gain or about threatening bosses with intimidation tactics or even physical harm.
While the front-line supervisor knows that ignoring such signs means paying for them later in lost productivity or work team disruptions, support staff often present a different perspective. Theirs is the world of hierarchical harmony and avoidance of legal, public relations, and reputational risk – all worthy objectives. However, one may as well fall flat on his face as bend over too far backwards. In their eagerness to avoid bad press or unpopular contests, these staff advisers tend to counsel too much caution, advising that no line manager ever act on any clues other than what exists in a given box of the job application. This is what John Steinbeck would have called the kind of smartness that cuts its own throat.
The solution? Don’t over rely on imperfect indicators like gut feel and questionable signs of irresponsibility, but don’t ignore them altogether either. Instead, use them to trigger a supplemental probe. Even if your staff advisers tell you that you cannot base a hiring decision on overabundance of body piercings or blatant indicators of irresponsibility, you can at least schedule a follow-up interview to ask questions and draw a person out. At the very least, ask. Offer the candidate some scenarios that compel choosing a course of action consistent with future job responsibilities. You might be surprised how often people admit to misdeeds or give themselves away through behavioral leakage – if you just give them a chance.
For more along these lines, see “Defending Against the Threat of Insider Financial Crime,” on page 17 of a recent issue of Frontline Security (at http://www.frontline-security.org/publications/10_SEC2_Money.php).
-- Nick Catrantzos
Tuesday, October 5, 2010
Lost Billions a Footnote?
Jerome Kerviel is now being sentenced for what briefly ranked him among the most infamous of ethically challenged traders. A few years ago, when he was caught, investigators attributed billions in losses to his gunslinger risk-taking with other people's money. Speculation in trading circles indicated the attending scandal could mean the end for Kerviel's employer, Societe Generale. After all, lesser yet similar financial malpractice ruined the venerable Barclay's less that a decade before. What is Kerveil's fate today?
Three years in jail and an order that he pay restitution to the tune of 7 billion euros, according to the BBC (http://www.bbc.co.uk/news/mobile/business-11474077).
Ah, here we see a clear sign of the power of inflation to turn yesterday's gasp into today's yawn. Evidently, as the BBC article concludes, what Kerviel gambled and lost is rounding error compared to the hundreds of billions lost in the American subprime mortgage market. Thus, at least in France, there appears to linger a perception that America can still outperform Europe.
It is interesting that the court finding Kerveil guilty absolved his employer of any responsibility for fostering a no-holds-barred, don't ask don't tell arena -- as long as the financial trades were yielding profits. It does seem Societe Generale will not escape paying some fines for failures of due diligence, i.e., for failing to institute reasonable checks to limit the impact of unreasonable actions. Unlike Barclay's, however, Societe Generale shows every sign of emerging intact from the catastrophic loss and scandal.
Why? Is it because the French are more forgiving that the British? Or is it because an accident of fate just happened to bring out so many financial misdeeds to public attention around the same time that Kerveil's misdeeds faded away by contrast? Lesson for malefactors: If you must sin, do try to time it so that other sinners are acting more prominently at the same time. It will lessen not only perceived villainy but also your punishment. Could a book deal be far behind?
-- Nick Catrantzos
Three years in jail and an order that he pay restitution to the tune of 7 billion euros, according to the BBC (http://www.bbc.co.uk/news/mobile/business-11474077).
Ah, here we see a clear sign of the power of inflation to turn yesterday's gasp into today's yawn. Evidently, as the BBC article concludes, what Kerviel gambled and lost is rounding error compared to the hundreds of billions lost in the American subprime mortgage market. Thus, at least in France, there appears to linger a perception that America can still outperform Europe.
It is interesting that the court finding Kerveil guilty absolved his employer of any responsibility for fostering a no-holds-barred, don't ask don't tell arena -- as long as the financial trades were yielding profits. It does seem Societe Generale will not escape paying some fines for failures of due diligence, i.e., for failing to institute reasonable checks to limit the impact of unreasonable actions. Unlike Barclay's, however, Societe Generale shows every sign of emerging intact from the catastrophic loss and scandal.
Why? Is it because the French are more forgiving that the British? Or is it because an accident of fate just happened to bring out so many financial misdeeds to public attention around the same time that Kerveil's misdeeds faded away by contrast? Lesson for malefactors: If you must sin, do try to time it so that other sinners are acting more prominently at the same time. It will lessen not only perceived villainy but also your punishment. Could a book deal be far behind?
-- Nick Catrantzos
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