Azure Global : 11/21/13

Thursday 21 November 2013

Investors: AT&T and Verizon must say how much customer data goes to NSA

Phone companies' customers could switch networks if they feel their privacy is being compromised, say investment funds

Big investors in America's two largest mobile phone companies have demanded they disclose how much customer data they hand over to the US and foreign governments. Documents from the NSA whistleblower Edward Snowden show AT&T and Verizon have installed equipment to copy, scan and filter large amounts of the traffic that passes through their networks.

AT&T and Verizon Communications, which owns Verizon Wireless, will face votes at their annual shareholder meetings following formal requests from one of New York's biggest public sector pension funds and a large private investment firm. The $161bn New York State Common Retirement Fund, which manages the pensions of more than 1 million state workers, and Trillium Asset Management, a Boston-based investment management firm with $1.3bn under management, havelodged demands with both networks to publish the number of requests they receive for customer information every six months.

The investors said customers could switch to other networks if they think their privacy has been compromised.

AT&T has also been warned that its willingness to co-operate with state-sponsored surveillance could hamper its ambitions to expand its business into Europe. The company is reported to be considering a bid for Vodafone, the British-based mobile network with outposts across Europe, Africa and Asia.

The Verizon chief executive, Lowell McAdam, when asked about the company's legal obligations, recently stated: "We are the largest telecommunications provider to the United States government, and you have to do what your customer tells you."

A Verizon spokesman said: "We've received the proposal and we're currently evaluating it." A spokesman for AT&T stated: "As standard practice we look carefully at all shareholder proposals but at this point in the process we do not expect to comment on them."

Article Source : http://www.guardian.co.uk
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EU backs move to boost numbers of female non-executive directors

Legislators back rules demanding firms choose women when men are equally qualified – but stop short of quotas

The European parliament has backed rules that would give women preference for non-executive posts at companies, after plans for a mandatory quota to get women into top jobs were scrapped.

The rules demand that companies give non-executive directorships to women where there is no male candidate who is better qualified, until they reach a target of four in 10 being women.

"The parliament has made the first cracks in the glass ceiling that continues to bar female talent from the top jobs," said EU justice commissioner Viviane Reding, who launched the proposal.

Although the draft law envisages possible fines for firms that ignore selection rules, it has been softened from imposing a quota with a penalty. Nor do the rules help women aiming for top management roles, such as chief executive. They also exempt smaller companies and those that are not listed.

Only about 17% of non-executive board members in the EU's largest companies are women. In Britain, women hold 17.4% percent of directorships, up from 12.5% in 2010; only four CEOs at FTSE 100 companies are women.

If endorsed, the rules will take seven years to come into full force. Countries are now required to sign off on the law but are divided on whether pan-European rules on positive discrimination are necessary.

Britain and Germany have argued against mandatory quotas.

Men dominate boardrooms in the region, and many women who have risen through company ranks resent quotas because they can be seen as suggesting that women have not been promoted on merit.

Only Norway, which is not a member of the bloc, has enforced a 40% quota since 2009, although critics say this has been achieved in part thanks to a small number of women holding non-executive positions in multiple companies.

"It is essential for listed companies to evolve so as to include highly skilled women in their decision-making processes," said Rodi Kratsa-Tsagaropoulou, a member of the parliament who is playing a central role in shaping the law.

Ikea France executives under investigation amid spying accusations

Head of Ikea France among those accused of employing private detectives to snoop on employees, particularly union activists, and even unhappy clients

Three senior Ikea executives in France were put under investigation on Wednesday over allegations they spied on disgruntled customers and former staff.

The head of Ikea France is among those accused of employing a firm of private detectives to snoop on individual employees, particularly union activists, job applicants and even unhappy customers, and of fraudulently obtaining personal information from police files.

A judge decided there was enough evidence to formally mis en examen(the equivalent of being charged) Stefan Vanoverbeke, the chief executive of Ikea France, his predecessor Jean-Louis Baillo and chief financial officer Dariusz Rychert, who were arrested on Monday and held for questioning.

Under French law, the men had to be formally put under investigation within 24 hours or freed.

Since January, a total of 10 people have been arrested and put under investigation for "fraudulent use of personal information", including four police officers and Ikea's former head of security.

The case is hugely damaging to the reputation of the flagship Swedish company famed for its family-friendly but infuriatingly difficult to assemble flat-pack furniture.

The accused are said to have requested a range of personal data, including criminal records and confidential details about the targets' dealings with the police or courts, even as witnesses or victims. Scores of people were alleged to have been snooped on, including a union official.

Last year, the satirical magazine Le Canard Enchainé obtained and published emails allegedly between Ikea's management in France and Sûreté International suggesting the security company was obtaining information from the national police information system on behalf of Ikea. The magazine said Ikea agreed to pay Sûreté International €80 (£66) for each request for information and that up to 200 demands were made at the same time.

Two unions have filed legal complaints against Ikea, accusing it of snooping on hundreds of people over a period of at least five years.

Among the claims is that Ikea asked investigators to find out if a customer, who was suing the company for €4,000 (£3,350), owned her own property or was known to the police. Other accusations centre on the tracing of car registration numbers.

Vanoverbek's lawyer, Alexis Gulbin, said his client denied involvement. "It was he who took corrective measures as soon as the problems were detected," Gulbin said.

Ikea France suspended and later fired the head of its risk management department last year along with three top-level executives, before publishing a new code of conduct.

In a statement in 2012, Christophe Naudin, head of Sûreté International, told journalists last year it had "consultancy and security contracts" with Ikea, but flatly denied snooping for the firm.

If found guilty of fraudulently using personal information, the accused face up to five years in prison and €300,000 in fines.Article Source : http://www.guardian.co.uk

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Royal Mail float: paying bankers' deferred fees would be 'mad', MP says

Select committee chairman says paying the extra fees would reward bankers who priced the float too low

The government would be "mad" to pay more than £4m in deferred fees to the banks that advised on Royal Mail's privatisation because they undervalued the company, the chairman of a parliamentary committee said after grilling the bankers on Wednesday.

Adrian Bailey, who chairs the Business, Innovation and Skills (Bis) select committee, said paying the fees, on top of more than £12m already handed over, would reward highly paid bankers who set the float price too low at the expense of the taxpayer.

Bailey gave his judgment after the committee questioned senior staff from Goldman Sachs and UBS, the banks that led the flotation. In more than two hours of questioning, they were accused of failing at their jobs and selling the taxpayer short.

The government sold 60% of Royal Mail at 330p a share last month, valuing the company at £3.3bn. But the shares leapt 38% on their first day of trading and closed on Wednesday at 550p, giving Royal Mail a market value of £5.5bn.

Goldman, UBS and five other banks that marketed the shares have so far been paid £12.7m between them but they could get a further £4.2m if Vince Cable, the secretary of state, thinks they warrant it.

Bailey said: "The government, in view of what has happened subsequently, would be mad to give them [the money].

"It would be seen as rewarding the private sector that lost the taxpayer potentially £1bn and, in these days of austerity, I think it would be a very politically dangerous thing to do. These are professional people, who got it wrong, and they would be rewarded despite the fact they got it wrong."

The banks in the syndicate that marketed Royal Mail to investors shared fees of 0.8% of the money raised, with Goldman and UBS splitting an extra 0.1% for leading the operation. The government's independent adviser, Lazard, has been paid £1.5m with no fees deferred.

Asked whether taxpayers would be willing to accept the banks getting the extra fees, UBS's James Robertson said: "I think that is for the secretary of state to decide. It is in his gift."

MPs questioned James Robertson and Richard Cormack of Goldman Sachs alongside bankers from Citi, JP Morgan and Deutsche Bank, which missed out on advising on the float. Gert Zonneveld of Panmure Gordon, who argued that Royal Mail was undervalued before the shares started trading, also appeared.

Goldman's initial pitch, made without inside information, valued Royal Mail at up to £3.75bn and UBS's top estimate was £4.6bn. The others were more than £1bn higher with JP Morgan's the highest at £8.5bn.

The banks' job was to sound out fund managers on how much they were prepared to pay for the shares and to generate demand in a so-called book-building process. As interest increased, they moved the price to the top of their initial 260p-330p range.

The UBS and Goldman bankers defended the sale price, saying a potential US debt default and the threat of a nationwide postal strike loomed over the flotation.

Robertson admitted the government could have got a further 20p per share if it had gone above the agreed range but he said the risks were too great because it would have caused a delay and pushed long-term investors to their limit. "Momentum can evaporate and go away very quickly … when we were looking at all the risks, on balance we chose to stick to 330p. We discussed it with the Shareholder Executive [which advises on privatisations] and Lazard and they discussed it with the secretary of state."

But committee members accused the banks of failing at their job and of being duped by potential investors, who always want to pay as little as possible.

Brian Binley, a Conservative member of the committee, told the bankers: "Somebody somewhere has failed the taxpayer and cost the taxpayer in this initial instance. I just wonder whether the taxpayer has the right to wonder whether for all the money you were paid you weren't very good at your job."

The committee's attention will now turn to Cable and his minister Michael Fallon, who will appear next Wednesday with representatives from Lazard and the Shareholder Executive. In his last appearance at the committee just before the flotation, Cable dismissed the prospect of a jump in Royal Mail's share price as "froth".

Bailey said the session with the bankers was preparation for asking Cable why he priced the privatisation so low.

"I think there was a recognition [by the committee that the price has been undervalued. Did they rate their political position as being more important than the interests of the taxpayer because if it was overpriced they would have had egg on their faces?"