Wednesday, April 26, 2006

More Scandal on Wall St.

http://www.nypost.com/business/64031.htm
(You may have to fill out a free registration to get access to thestory.)

After reading Antilla's Tales from the Boom-Boom Room, it is not surprising to hear that sex scandals continue to plague the big firms of Wall St. This time, Morgan Stanley is the target of the allegations, but this time there is a twist, the sexual harassers are females! Allow me to set the scene:
-2004 Morgan Stanley settles sexual harassment claims for $54 million.
- Shorlty after setlling, Morgan Stanley takes a proactive approach and delegates the responsibility of keyword searching e-mails for "sexually graphic" terms.

This is where our protagonist, Arthur Riel, enters the scene. Riel was a tech-executive for the firm and this new responsibility soon fell under his official duties. Riel, in one of these now routine searches, stumbled upon a thread between "X-rated e-mail chats between his boss, information technology director Moira Kilcoyne, and executive director Rora Tanaka," in which, among other comments, were comments which could be considered offensive to male employees. 13 months later, after Kilcoyne got word of his discovery, Morgan Stanley terminated him for "violating the privacy of his colleagues." Riel is suing for wrongful termination and seeks to recover $30 million dollars in lost wages and damages. Morgan stanley has responded with the following comment:
"It was reprehensible for Mr. Riel to intercept, misappropriate and share personal e-mail between two co-workers. It was conduct of this nature and other abuses of his position that rightfully led to his termination."

It seems there are a number of employment law issues to be discussed with regard to the circumstances surrounding the termination of Riel. One of these being that these routine searches were a task he was not only delegated to conduct, but also mandated. The company has asked their employee to carryout such searches and report such "sexual-harrassmently" suspicious conduct. It would seem that this then is a violation of privacy mandated by the company and it is not the intent of the employee to whom the task was delegated. If in fact these searches were to be used as a proactive means by which to prevent future sexual harassment claims, is that not what Mr. Riel has reported? Can we really hold an employee mandated to carry out an action by his employer responsible for the outcome of the action? Granted this story does not include all of the facts of the case, but "all-things-considered," I would have to side with Mr. Riel. Whose side do you take?

1 Comments:

Anonymous Anonymous said...

Riel was concerned when Kilcoyne took over the area from Riel's friend Shelley Liebowitz. This, plus he was getting in trouble for having signed a statement for the Coleman case that said MS had provided all required email from the discovery process, which he knew may not have been the case at that time. Contrary to his claim that he was asked to directly search for offensive email, he was actually surfing targeted email accounts of key executives in the Firm in order to find damaging materials to negotiate a better severence.

Finally the search tool that Riel was in charge of, and is now subsequently trying to sell in his new business venture (Lighthouse), includes an easy to use front end. Certainly MS Legal would have had an attorney doing these types of sensitive searches using Riel's tool; not an IT manager!

One other note. Riel doctored the emails regarding the Yankee tickets. Why wouldn't he doctor the Kilcoyne material?
Riel's attorney has used Roddy Boyd, one of NYPost's business writers to embarrass executives at MS so that they settle. If you look back at Boyd's stories you'll find one about another MS IT executive who tried to get favors from the Yankees, and a reference to the Asia ibanker who harrangued this same executive for not giving more IT business to his client.

If Riel was looking for dirty words on his search, then how does he explain the Yankee story and the head of Asia pressing for more IT spend for his clients.

I suggest that Riel was just trolling for dirt for his own betterment once he knew he was toast for contributing to MS's painfully stupid behaviour during the Coleman discovery.

10:45 AM  

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