Tuesday, September 22, 2015

VW vs. GM: The Akerson Effect

ZeroHedge educated the public on the government's relatively light handed treatment of GM's management malfeasance vs. Volkswagon's.  I'd like to add another element, GM's President Daniel Akerson, who received complaints of failed ignition switches.

GM has admitted that some employees knew about the problem for nearly a decade, yet cars equipped with the switch were not recalled until last year

Read more here: http://www.tri-cityherald.com/news/business/article36195858.html#storylink=cpy
Prior to heading GM for four years Akerson worked for The Carlyle Group and sat on the board of Boeing.  After leaving GM Akerson returned to Carlyle and joined Lockheed Martin's board.

At Carlyle Akerson learned how private equity underwriters (PEUs) maintain their good name, even when they had multiple reasons to hang their heads in shame for bribing public officials (Synagro), allowing twenty five patients to die in the aftermath of Hurricane Katrina (LifeCare Hospitals) and making billions in bad energy bets (Semgroup).

I'll venture Akerson made it clear no bad news was to arrive in GM's C Suite and anyone wanting to keep their job complied.  What happened to letters sent directly to Akerson on the issue?

Last Thursday GM was fined $900 million for covering up its faulty ignition switches that caused at least 124 deaths and hundreds of injuries.

The deal with GM was cut by U.S. Attorney for the Southern District of New York Preet Bharara, who said there’s no federal criminal penalty for knowingly putting a deadly product on the market. "It has been a challenging case, for the agencies, for the prosecutors and for me," Bharara said.

As a result, nobody was prosecuted by the US government. 
The Government-Corporate Monstrosity will go to great lengths to protect insider connected people like The Carlyle Group's Daniel Akerson.  It's their latest success.