I'd encourage a bit more skepticism to this article. While this accusation could possibly be true, there are two things to keep in mind, which I am sharing having experience as a founder/CEO who has gone from startup to IPO:
1) This is taken from a complaint in a class action lawsuit. Class action lawyers are very similar to patent trolls whereby they can spin almost any story they want. And journalists go for clicks, so they amplify the sensationalism. It doesn't mean this is one of those, but a class action complaint should not just blindly be trusted.
2) There is a strong theme of "of course execs lie cheat steal at every turn" and I also think this narrative should be questioned. Ethics aside, the level of compliance in a public company is insanely high. Execs are already rich. To risk jailtime, which fraud can lead to, you'd need to see something more existential than slightly increasing margins on used van sales.
I felt inclined to comment as I've been on the other end of articles like this, and it is astounding the level of mind reading people have done into my intent and actions on things that were factually just not true at all. I also truly would find it very difficult to commit a broad organizational fraud even if I wanted to and my company is only 500 people.
If I had to make a prediction, the case is less black and white than it appears, and if there was fraud, it was probably committed at a non-executive level by the person whose P&L was directly tied to these resales. Or, it was done independently by the much smaller leasing company where this was more existential to them. It is highly unlikely to be a Fed Ex executive-level conspiracy.
I'm sure there are a few counter examples, such as say the VW emissions scandal, but I would counter these were the exceptions that proved the rule and in general when the C-level was involved was much higher stakes.
Helpful perspective. As a lawyer who has worked on both sides of class actions, I generally classify these cases in four categories:
-Legit cases that describe (or at least ultimately lead to finding) clear and meaningful wrongdoing. There's always some room for arguing one way or the other but ultimately there's some clarity that something meaningfully wrong happened. I think these are probably ~3-5 percent of cases filed. These cases tend to settle relatively early for high dollar figures.
-Cases of clear but unimportant wrongdoing. Technically a statute was violated, but no one was really hurt at all. These tend to settle for small $ figures. Perhaps 20% of cases.
-Important but unclear wrongdoing (evidence supports either finding; among one million documents, some look really bad, while others look very exculpatory). These stick around for a long time and ultimately earn lawyers a lot but cost the parties, on average, a lot of money to litigate. Perhaps 30% of cases.
-Complete/fabricated nonsense and/or fishing expeditions. Cost defendants a fair amount (and brutal for small defendants), but not the end of the world for big defendants. Perhaps 50% of cases.
VW is in the business of selling vehicles, and has a real interest there to push the envelope as much as possible.
FedEx is not in the business of selling used vehicles. These vehicle sales likely don't impact their core business in the slightest - making an organization-wide scandal just silly to even think about.
Looking online, these types of "vans" sell for anywhere between $5,000 and $30,000 (with 4 digit miles)[1]. Seriously... FedEx isn't going to blink at any of this.
These class actions are always brought by bottom-feeding lawyers that use serial-plaintiffs. The reality is the class action bit will be retracted, and the lawyers, err, plaintiff will receive a "go the hell away please" payment. That's the game here...
I'm sure this isn't something at the exec level, but it seems possible someone somewhere in middle management who oversaw used van sales wanted to increase their revenue numbers and thought cheating the odometer would be an easy way to boost their numbers.
It's not even clear if FedEx has anything to do with this. The other named defendant is "Holman Fleet Leasing", which seems to imply these vehicles were leased to FedEx.
If that's the case, then any possible scandal here would be squarely on the company selling the vehicles - not FedEx.
FedEx might just be a tacked-on name. You see that quite often with Prop 65 cases. The plaintiff attorneys add anyone even remotely related to the case, just to drive up pressure and chaos, hoping for quicker/larger settlement offers.
In this situation, even if FedEx has nothing to do with vehicles sales, they might opt to settle and write a check just to make the bad publicity go away. If you think that sounds like a shakedown, you'd be right.
In a civil case this is the right thing to do. Chances are good that a company as large as FedEx very closely met with leasing providers and discussed how they were going to get those costs down, better than if FedEx didn't lease. The lawyers would be silly not to fish for signs that FedEx knew a bit about why it could get the leasing rates it wanted.
I have no doubt the leasing company would factor in re-sale value of the vehicles... that's how all vehicle leases work.
I do doubt FedEx would be in any way involved in the details of selling leased vehicles. I can say with a high degree of confidence there never was a meeting with FedEx execs where they pitched the idea of increasing residuals by swapping odometers...
That's not really necessary. It sounds unlikely to me that there wouldn't be a paper trail with someone in FedEx's procurement about such a project, particularly if this really included FedEx racking the miles on the new odometer.
A project to cut an ongoing vendors costs is about the only way for a large cap procurement specialist to meet and exceed targets with no possibility of additional valid free market bids. That opens them right up to questions of liability, with managers knowing or avoiding knowledge, workarounds, special advice to other divisions, etc.
You don't have to go to jail to lose a lawsuit.. I worked for a company that put together a whole system for reporting these kinds of ethics irregularities in the companies favor. I don't think that was a charity, they act as a defense or at least lower punitive damages a judge is likely to award when violations still occur.
There's actually a legal reason for tacking on anyone who is plausibly liable. The basic idea is to sue everyone in a single case and let the court sort out actual liability for each party as part of that single case.
Say the lawsuit is originally against just Holman Fleet Leasing and FedEx is the one legally liable (Maybe FedEx is the one that is doing something naughty. Maybe there's some contractual language around Fedex assuming all legal liabilities for the vehicles sold.). You're going to spend a bunch of time in court arguing with Holman about if they're even the right party to sue, and your case is either going to get thrown out or you're going to lose. Meanwhile, the statute of limitations is still ticking, so if it takes a long enough time to adjudicate the case against Holman, you won't even be able to refile the same case with the correct respondent. Oops. but if the statute of limitations miraculously hasn't run out yet, that's not even considering the possibility that the kind of person who would roll back an odometer would also have a punishingly short document retention policy, so all the documents that still existed at the time you filed against Holman have long since been shredded and destroyed, so your discovery in the new case against Fedex is going to be a single email saying "yeah, we don't have anything going back that far. Oops again.
Now consider the lawsuit filed initially against both Holman and Fedex. Assuming your list of respondents is complete, the case isn't going to get thrown out because you sued the wrong person. Liability will still be adjudicated (and the case amended to drop respondents as the proper liability holder gets determined), but now you don't need to worry about the statute of limitations running out as you wait for the determination of liability against the first respondent. And the document retention clock starts with that lawsuit and covers the time where you're just determining who hold liability, so now they can't delete those documents even if they other wise would be. Both of them are now going to be legally required to retain all the stuff you list in discovery for the duration of at least their involvement in the case. Sure, they could destroy those records anyway, but that sort of thing is regularly used to infer guilt of the respondent with the worst possible inferences when it's destroyed in violation of discovery.
These things never see the inside of a court room. It'll end up as a settlement check, with none of the involved parties admitting to anything. The lawyers will then move onto the next low hanging fruit.
I've learned over time, it doesn't matter how righteous your defense is - all that matters is the money it'll cost to make the issue go away. Turns out, it's almost always cheaper to write a check than defend yourself.
> It's not even clear if FedEx has anything to do with this.
A company the size of FedEx has accountants and actuaries watching leases of this scale like hawks. It's simply not believable that Fedex never "noticed." And if they noticed they were getting much better than normal resale values but didn't ask why, that's very much the definition of complicity.
Well yeah there's that, but it can't have been just one person; there's at least dozens of people involved in the trading and maintenance of these things, there's paper trails for the purchase and I presume installing and replacing of the odometers; there's bound to be loads of people that are in the know, and since the true odometer reading can be read from the onboard computer, I find it really hard to believe that nobody caught this before.
It would've taken just one case of a mismatch between the digital and physical odometer without it being mentioned for a huge stink to be thrown up. And it'd also be the auction house's name on the block, because they should check these things themselves. If this is as widespread as they claim it to be, then even the occasional spot checks would show it.
Although I know this might get met with pushback, I think it's reasonable to argue some of the regulations pushing back against VW were only there because domestic manufacturers didn't want to have to compete. You could argue the emissions scandal wasn't just about money, it had a government corruption component to it as well.
It may have been somewhat more easy to regulate nitrogen oxide emissions in the US, but it isn't primarily a protectionist move and VW was also cheating in the EU.
Underlying U.S. and EU emission standards
The Volkswagen and Audi cars identified as violators had been certified to meet either the US EPA Tier 2 / Bin 5 emissions standard or the California LEV-II ULEV standard. Either standard requires that nitrogen oxide emissions not exceed 0.043 grams per kilometre (0.07 g/mi) for engines at full useful life which is defined as either 190,000 kilometres (120,000 mi) or 240,000 kilometres (150,000 mi) depending on the vehicle and optional certification choices.
This standard for nitrogen oxide emissions is among the most stringent in the world. For comparison, the contemporary European standards known as Euro 5 (2008 "EU5 compliant", 2009[5]–2014 models) and Euro 6 (2015 models) only limit nitrogen oxide emissions to 0.18 grams per kilometre (0.29 g/mi) and 0.08 grams per kilometre (0.13 g/mi) respectively. Defeat devices are forbidden in the EU. The use of a defeat device is subject to a penalty.
For a company that has its own relatively large fleet of aircraft ... $5,000-$30,000 is a few screws and some grease on an airframe.
While the some book keepers will care, in its grand scheme of operations that amount is negligible to the point where it may cost them more in man power than what they recoup from doing so.
> VW is in the business of selling vehicles, and has a real interest there to push the envelope as much as possible.
As I understand it (sorry, I don't have a citation handy) was that VW was gaming the tests, but in order to make their vehicles' operations MORE efficient. That is, the tests are dumb because they concentrate on start-up emissions with less attention to warm running. VW wanted to also optimize the warm running, but to do that they had to game the software to still appear to optimize only for the cold start.
That is, aside from the ethical problem of cheating the regulation (a big aside to be sure), they were acting more responsibly than most.
> VW was gaming the tests, but in order to make their vehicles' operations MORE efficient.
VW's cheating is in essence the cars have two modes to run the engine; compliance mode and performance mode, and they run in compliance mode when the car starts up until the steering wheel is turned (more or less).
In compliance mode, the engine control follows the rules to meet the emissions test standards. In performance mode, operating temperature is allowed to increase, which increases performance, increases fuel efficiency, idles better, etc, but increased operating temperature leads to more NOx emissions.
Additional, for models with diesel emissions fluid, performance mode injected much less DEF than compliance mode; DEF reduces operating temperature as well as directly reacting withe NOx. This reduced use of DEF allowed a smaller DEF tank to be used; regulations require passenger car DEF tanks to have enough capacity for normal use within the regular service interval; if the vehicle was operating in compliance mode the whole time, you'd need to fill the DEF tank between oil changes (or have a larger tank, which needs to fit somewhere).
In the end, the big tradeoff is fuel efficiency (and therefore CO2 emissions) vs NOx emissions; which is a fine tradeoff to consider, but you can't give drivers what they want and regulators what they want without cheating.
> As I understand it (sorry, I don't have a citation handy)
This is so irresponsible of you to just assert without evidence, and is so out of context to portray VW as the good guys here. They did not break the rules and flaunt regulations to make their system more efficient. They did so to cover up their failure to deliver on a new generation of "clean diesel" tech. VW thought they could do it, they invested billions in it, and they couldn't figure out how to do it without emitting way too many other pollutants. So they built their cars to lie to regulators.
The tests cover an extensive range of use cases, mostly warm running. There were two modes, one that was more fuel efficient but emitted NOx above regulations, and one that was less fuel efficient but was within NOx regulations. They detected when the tires were on suspension that simulates real-world driving for testing. They got caught by academics who wanted to test real-world vs simulated suspension.
"The road tests captured a variety of conditions: high elevations up Mt. Baldy; stop-and-go urban errand-running in San Diego; freeway driving around Los Angeles. The two Volkswagens’ emissions exceeded standards by 5 to 35 times. The BMW’s didn’t. [...] The Lean NOx Trap is a system of concessions. To get cleaner exhaust, you’d need to use a squirt of fuel every few seconds to burn up nitrogen oxide. Or, in the other direction, to get better fuel efficiency, you’d need to spew out dirtier exhaust. Managing this trade-off requires a complex calibration of the onboard computer, the engine control unit, so it can adjust constantly to variables like temperature and speed and optimize both emissions and fuel usage. The trouble was, Volkswagen hadn’t been able to get its new engines to comply with the stringent U.S. standards."
The reason is they had invested in a "clean diesel" engine tech that was supposed to be their market differentiator. VW invested billions into it. Yes, it was more fuel efficient, but it was supposed to also stay within existing pollution emissions regulations. Nobody else made such big investments in clean diesel because they couldn't figure out how to make it more efficient without also emitting pollutants at much higher levels. But everybody was so bought into it that they felt they had to cover it up.
> Execs are already rich. To risk jailtime, which fraud can lead to, you'd need to see something more existential than slightly increasing margins on used van sales.
This seems incredibly naive. You'd have to be willfully ignorant to think that a) rich people won't break the law to make a tiny bit more money, and b) fraud committed by large corporations often results in jail time.
I agree with you that this article isn't worth very much, but that's only because lawsuits in general shouldn't be trusted without corroborating evidence, not because a rich executive would never do this.
I personally see nothing naive in the parent post. It brings arguments based on knowledge how organization works and appeals to a game theory (stakes do not match). I'm not saying the reasoning is necessarily valid, but it is not naive.
The only part of the parent comment I do not approve from a methodology standpoint is an appeal to "exception that proves the rule". Exceptions do not prove rules, they disprove them.
I don't think there's a single "correct" way to use that phrase, different people understand it differently. The meaning I'm most familiar with is an obscure exception demonstrating that your rule of thumb is usually reliable. For example:
"Street parking is always allowed"
"Not always! Three years ago there was a marathon that went through this street and you weren't allowed to park here that morning."
This exception is so specific and obscure that it "proves" (in a casual conversational sense) that "you can always park here" is a good rule. Not all exceptions prove the rule: if the exception is "except on weekends and holidays and overnight", that's so significant and obvious that it actually disproves the rule.
I thought it was more along the lines of prove = test; the exceptions clarify the rule. Or in AI training terms, you need negative test cases as well as positive test cases to adequately define a rule.
Thou shalt not kill, except all the times thou shalt.
Words being what they are, and us not speaking the language that created this saying, I'm guessing both general ideas can be true. :D
My memory is this came from Cicero and was about a place excluding women by rule, as they pointed to the exception of a woman that was allowed.
https://en.wikipedia.org/wiki/Exception_that_proves_the_rule seems to support both interpretations, and at least shows I got the speaker right. Not seeing that my specifics are good, though. I would not be shocked to know that I am wrong there.
“No one becomes a billionaire without hurting a lot of people” is still true, though inflation will eventually make us have to change that to “multi-billionaire”.
I understand your defensiveness, but the article did not even imply that the CEO was directly implicated. That said, I think it is still at some level their responsibility if this fraud turns out to be true; “the person whose P&L was directly tied to these resales” still had ever stricter OKR’s they had to answer for, and apparently no double-checking or auditing was done because that person’s boss didn’t want to know. They were rewarded for numbers going up and to the right, as was their boss, as was their boss, up to the CEO.
Sorry, I just tire of narratives where when a corporation does something morally wrong, it’s the fault of nebulous capitalist hyper-optimization and no individuals are held accountable.
Isn't this an example of an "accusation based judgement"?
> This is taken from a complaint in a class action lawsuit. Class action lawyers are very similar to patent trolls whereby they can spin almost any story they want. And journalists go for clicks, so they amplify the sensationalism. It doesn't mean this is one of those, but a class action complaint should not just blindly be trusted.
This amounts to "class action lawyers and journalists are bad so we can ignore what they're saying".
I don’t think you have to conclude that was shared for that reason. It could be shared simply as “this is what a plaintiff alleges, and we don’t have any data or anything further to verify that these claims are true.”
There's evidence from one side in the lawsuits, while the defendants have so far declined to submit any for scrutiny. In any case, the title of this submission says that Fedex is 'accused' of fraud rather than having been found guilty of it, so you knew what you were getting before you clicked; you could have just ignored it.
When someone files a complaint against you with a court of appropriate jurisdiction to start a lawsuit, your only sane option is to file an answer. The complaint lists their allegations point by point. The answer either admits or denies each allegation, point by point.
It is not surprising that FedEx has declined to submit evidence for scrutiny. It’s not time for that yet. They will be required to do so in discovery and they better hope they can at trial but right now we should not expect to hear anything from them other than “admit, deny, insufficient basis to form a belief and therefore deny.”
It’s just too early for an evidence based discussion. This is the nature of the civil action.
There's absolutely nothing preventing them asserting their version of events and following up with evidentiary filings within a reasonable timeframe. Just like there's nothing preventing corporations from admitting liability and apologizing, but they generally prefer to settle instead and never ever admit fault, thanks to the pernicious doctrine of maximizing shareholder value.
Generally I agree with you but there’s also not anything stopping you from writing me a check for fifty grand. Nothing incentivizes them to disclose anything. I’m not too crazy about the state of affairs either.
There’s no value in presenting your evidence in the court of public opinion and intrigue. Argue your position in an actual court, where and when it matters. If a bunch of impatient people over-react to hearing only one side’s argument, so be it; you’ll exhaust yourself trying to convince them anyway and, in general, their opinion isn’t worth swaying.
Of course there is, perception matters or companies wouldn't have PR departments. They shove their brands in the public's face 24/7 with messages about how great they are but when they look bad they put on an air of injured dignity and cite platitudes about the legal system. The reality is that corporations usually just hope to exhaust plaintiffs in the legal system instead.
I went to law school and am married to someone who works in litigation at a top 10 law firm, I understand very well how the legal process works both technically and in economic/strategic terms.
Would companies prefer to have their PR departments talking about positive things the company is doing or refreshing and giving voice to an accusation of odometer rollbacks? I read nothing into FedEx’s silence on the topic, other than they are being run by adults taking competent advice.
competent advice to minimize liability and downplay unflattering news, or competent advice to behave morally and righteously in the eyes of the public?
seems the former, so you can see why the public is unimpressed
This is really the crux of the failure of organizations. The execs might not want fraud (or other problems) to happen.
But, upper and middle management don't care about the company as much as the execs. They would much rather show the numbers, earn their comp and fuck off, than worry about long term sustainability of the company or of their reports.
Has anyone really complained about middle management yet?
The only thing a frustrated middle manager can do to deal with sociopathic upper management that turns a blind eye to departmental suffering is to candidly look at the bullshit you have to put up with, then make the decision on whether you've got the life left for this bullshit.
Unironically, earn the comp, and fuck off to let the next person up the totem pole deal with the consequences of their decisions.
Shit may roll downhill, but sometimes, nothing changes til the guy at the top gets a swift boot to the ass in the form of a dose of Real Life (TM).
Yes, a decent middle manager doesn't have too many choices either.
It is getting clearer to everyone (from execs to ICs) that the command structure with layers and layers of management gives rise to pathological behaviors in the organization.
Perhaps this round of recession will bring some change to organization structures - ideally with less middle management.
A flatter hierarchy isn't a great solution to an excess middle management when it means that one manager has 15-20 direct reports, as opposed to a healthier target number of 6-8 or maybe 10-12 at maximum. It is important that each manager has adequate time to manage each of their people in a way that enables the kind of proper relationship that supports their team members when they need it.
The current round of recession will probably temporarily shrink some companies or cut off some lines of business, thereby flattening the hierarchy in a less harmful way than what I described. But overworking managers is a different bad thing.
Maybe you're advocating for a smaller maximum company size overall, so that a relatively flat hierarchy doesn't overwhelm those managers who do remain? Or for some right of participation by non-executive managers in collective worker action, as exists in Germany and as acted in the original version of the US National Labor Relations Act before the Taft-Hartley amendments, so that some kinds of large-company pathologies can be addressed better?
The main reason why flatter hierarchies doesn't work is because managers are asked to do work reporting, career management and performance management. But all of these are pathological, BS work.
Reporting can literally be done by an "administrative assistant". You could have an administrative assistant for 50 ICs and it won't make a difference. There is no need for layers.
Career management only exists because there are so many layers in the ladder. If there were only 2 levels, and then VP, there would be no need for career management. There is no need for layers for the actual work to get done.
Performance management is another load of crap because it is something that should only be required for determination of rewards or to completely fire people. But this job doesn't need layers and layers of management.
If you want to see the structure top down, the CEO should have VPs who allocate money to teams. The teams should have pieces of ownership that they are supposed to run and maintain. A team lead/captain can run the team.
But that's it. What is the need for kingdoms of apes that don't really do much except pushing work downwards?
I see you’ve only had bad managers in your career. I’ve had both. The bad ones sometimes wrecked companies when they were in the C-suite and wrecked individual careers or teams when they were directly running a team. The good ones turned careers around (including my own when I was an immature oblivious junior) and helped get org-wide buy-in for a necessary re-org to fix real problems that ordinary technical employees noticed.
Shoveling around money and work is only a small piece of the job.
A good line manager does things like help resolve interpersonal and inter-team issues, helps address the issues causing underperforming team members to underperform so that they can improve instead of be fired, handles firings and layoffs when necessary but only as a last resort, makes sure team member career goals and skills get considered as opportunities arise, shares concerns and updates both up and down the chain, advocates upwards for necessary staffing and worthwhile raises, oversees hiring for the team in collaboration with the recruiter and tech lead, explains downward for applicable constraints and works with the tech lead how to apply them to the tasks at hand, and so on.
These have all been my goals in my line manager jobs. Notice I said nothing about technical matters or project management or driving execution. That’s tech lead stuff, with some oversight from the manager to make sure business needs are met.
People need management just like computers systems do, but the skill set is totally separate. Computers always do what they’re told, even if software bugs sometimes mean you didn’t tell them you think you told them. People have feelings and needs. Very different.
For a team of more than a few members, management is a full-time nontechnical job. For a 2-4 member team, yeah it can be split.
A good middle manager does the same kind of thing as I said a good line manager does, but managing managers and their teams/orgs instead of individuals.
A bad middle manager does what you think a manager does, and/or several other failure modes.
Fast growing startups have little middle management. Bloated pathologic orgs dying in a recession have a lot of management. To have fewer management, we need to only have young companies and let older ones collapse sooner.
Even if you turn out to be flat wrong, I still appreciate the level-headedness to consider how we got to this point and the urging we all slow down a bit before we all march on FedEx headquarters.
I'd be lying if I said I'd never thought about it. Given how many dejected people there are in society, including those who have had military training, I'm surprised there hasn't been more of it at this point.
We had a lot more vigilante justice in the 70s. It went away with the rise of tough-on-crime laws in the 80s (vicarious punishment) and eventual counter-domestic terrorism (suppression) in the 90s. Bernie Goetz would be crucified these days.
00s just became mob rule via social mechanisms and manipulation; cliquish behavior is not something you can shoot or detonate, so we're stuck with people taking out their frustrations on children at school and anybody unsuspecting. The dejected are only going after targets they can reach (a tragic, but logical outcome).
There was one aspiring vigilante in the last few years who drove across the country to assassinate some scummy judge or something and was immediately caught while doing recon. His mistake was going after someone afforded protection. Everything is political and treated as terrorism. It's too risky to vote from the rooftops these days; there are an increasingly-infinite number of ways to fail.
Asbestos in talcum powder. PFAS exposure and dumping into public water supplies. Monsanto and roundup. Cigarettes health effects. Climate change from burning hydrocarbons. Norfolk southern and the controlled burn in east palistine. I could literally go on and on about the history of execs poisoning people and the planet while knowing full well about it. All to keep the profit margin, but you know this stuff you’re just willfully ignoring it.
I agree with your first paragraph. The last sentence is a stretch though. The fact that there were multiple execs who were blatantly unethical doesn't mean most execs are unethical.
Would it be better if I listed every instance of executives choosing to poison people, willfully put them in dangerous working conditions to save some money against the law, releasing products they knew would maim people or kill people… all for marginal increases in share price? It’s a long freaking list.
This is the way this system is setup. Executives pursue profit at the expense of everything else. This is the cornerstone of capitalism.
> but you know this stuff you’re just willfully ignoring it.
That sure is what it seems like. C-level solidarity, even managed to blame the peons with just as little evidence as everyone else blaming the execs...
There:s a difference between strategic "say no evil, see no evil,..." Which is rampant in C-level management, and the public having difficulty leveraging legal discovery processes against corporations with far more budget to throw at defanging or maliciously complying with such request, and there "being no evidence".
Evil exists. Stop shoving your head in the sand and realize it's an uphill fight.
Just because it isn’t prosecuted in our system doesn’t mean that the execs choosing to poison people isn’t a crime.
Maybe I have a naive view of the law, but when you read a report that says your chemicals are poisoning people, and you choose to dump it in public waterways, you’re guilty of a crime personally.
All of us here work at jobs, possibly in very large corporates. Do we see anything illegal going on? I would reckon that >90% of us have gone through our corporate life without ever being a part of anything close to even illegal, at worst we forward something to legal to be extra sure. So if we think corporations are regularly behaving illegally, we all have simultaneously seemed to have lucked out to be in the one the one ethical and legally compliant organization.
If some part of your worldview is that the world is being filled with greedy, selfish and unethical people, constantly trying to screw over others but you are the exception most likely your worldview is completely off (Most people view themselves as the good guy/ hero of their world). In my experience it is very unlikely for anyone in C Suite to ever risk any actual fraud in their dealings (or anyone in the organization really), however lawyers are essentially parasites on society who feed on productive work to make a living while gaslighting rest of society into believing that they’re playing an important role in protecting it.
> All of us here work at jobs, possibly in very large corporates. Do we see anything illegal going on? I would reckon that >90% of us have gone through our corporate life without ever being a part of anything close to even illegal, at worst we forward something to legal to be extra sure. So if we think corporations are regularly behaving illegally, we all have simultaneously seemed to have lucked out to be in the one the one ethical and legally compliant organization.
This line of argument only works if the majority of a company is exposed to illegal behavior.
If a large company can commit (or attempt to commit) illegal behavior, while making that behavior only visible to a small fraction of people, then this argument falls apart.
For example, how many people were involved and aware of the VW emissions scandal? 200? 400? Out if 200,000 worldwide employees. So >99% of VW employees would have likely reported not having observed illegal behavior. That does not mean that those employees “lucked out” into working for an ethical legally-compliant company. It means the company is smart enough to hide its unethical and disreputable behavior from its employees as much as possible.
I don’t think the VW situation is at all unique, just the handling of it. I understood Deiselgate because I’ve worked for managers who just wanted checkboxes checked, and I’ve seen people who reward monetarily or with praise for solving problems but who don’t check for dead bodies before doing so. Too many coworkers who get promoted for making messes others had to clean up. What if the cleaners don’t exist in sufficient numbers? Or get laid off?
When you combine a mercenary mind with oversight from a person who doesn’t believe in “if it seems too good to be true, it probably is” that’s when the bad stuff starts to happen.
There’s also a machismo school of business that lionizes force of will. Telling employees you want something that seems impossible and expecting them to get it. Nevermind that by far the easiest way to cross an impossible finish line is to cheat your ass off.
How many products do we need class action suits on? How many exposes on child or captive labor? How many superfund sites? How many companies going bankrupt ten years later when the truth comes out, before we hold people accountable and call bullshit on the “aw shucks” response to tough questions?
Or maybe a Bachelor of Arts from a business school is not enough rigorous education to run a multinational company.
astounding the level of mind reading people have done
In this case, though, Fedex has just denied the allegations but not proffered any alternative explanation. Nature abhors a vacuum, and human nature abhors an information vacuum. Corporations habitually refuse to share information unless they are forced to do so legally, so they have only themselves to blame for the subsequent distrust by the public.
I think what you may be missing is the effect of compounding organizational incentives in big, old companies. I wonder - how much experience have you had in large legacy companies? (think "F100 company's subsidiary, based in Dubuque" type company)
I once helped fix up a manufacturing co that materially overstated net income by >10% for a decade. And it was just a mix of honest mistakes, miscommunications, some incompetence, and a shockingly small amount of fraud (though not 0).
I learned it's really easy for sr execs to run the company badly, one or two junior execs to push the limits, and a everyone else to just be a biiiit lazy - and bam, there's a big fraud.
That said 0 stock is up 5% w/w, so this can't be THAT big
Misrepresenting an odometer reading as true is a federal offense, and it seems clear that this happened in at least one of the cases in the article. I’ve never seen a car title that doesn’t have a field for noting an in accurate odometer. Federal rules also makes the seller sign an acknowledgement that the odometer reading is true, rolled over, or unknown.
Maybe there was no conspiracy involved, and the fleet mechanics were just swapping out defective gauge clusters (somehow always swapping in a lower mileage cluster).
So the best defense they have is that this was an accident of sloppy record keeping leading to a failure to make legally required disclosures… which is not a great defense.
I am willing to believe that if you shuffle a problem around enough you create a situation where nobody knows the truth and we’ve made it punishingly difficult to go get it.
It would be easy in a delivery business for an odometer to roll over one or even twice, and if you assign the new kid to get rid of the old trucks he might assume things.
That is not to absolve anyone. The truth can be a liability or an asset, and has to be managed not unlike inventory.
But that’s not what happened here:
> The lawsuit accuses FedEx of replacing the odometers in many of its vans with new ones that read zero miles, using the vans for a bit longer after that, and then selling them at auction with 100,000 miles or less on the new odometers.
That stretches credulity. But also, if you buy a FedEx truck or a police cruiser thinking you got a good deal on a low mileage vehicle, you’re a fucking idiot. Of course they’re going to drive them into the ground before selling them.
Right, but my point is that the truth is actually pretty easy in this case.
There's a federal law that requires you to either swear that you know the odometer reading is accurate, that the odometer has rolled over, or that the true odometer reading is unknown. This disclosure is made on every vehicle sale, and there's a standard form.
If you can't swear to the first two, you swear to the last one.
I wouldn't assume that a low mileage fleet vehicle is necessarily beat. Maybe it was assigned to a short route (There's a FedEx route on Lopez Island in Washington, half his day is spent on the ferry), maybe it is being phased out early due to a change to electric. There's a lot of reasons FedEx might sell a low mileage vehicle, and if you have a legal document from a major corporation stating that the mileage is accurate, most people would trust that.
> I, ______________________ (SELLER’S NAME, PRINT) state that the odometer now reads ______________________ miles (NO TENTHS) and to the best of my knowledge that it reflects the actual mileage of the vehicle described below, unless one of the following statements is checked.
The seller is only strongly asserting what the odometer reads. If the seller doesn't know anything about that vehicle, then "to the best of [their] knowledge", that reflects the actual mileage.
Also to clarify, none of this is sworn, or "under penalty of perjury"
I don’t think I misrepresented that. You have to include the “following statements” that the form mentions, which are exactly what I caveated.
If you are a representative of a company that has written records indicating that an odometer was replaced (there is no possible way that fedex doesn’t keep maintenance records), I would argue that “the best of your knowledge” means accessing all those records and ascertaining that the odometer reading is true.
It’s not penalty of perjury, it’s penalty of federal law. Lying there is breaking a federal law specifically written to prevent this sort of odometer fraud.
Places like CarFax collect data from maintenance done on the vehicle. In which case you may be able to detect mileage rollback because the number goes negative between two visits.
But a private vehicle fleet may use private mechanics, who probably do not report information like that (there's no financial incentive to do so, and there's probably no mechanism to make it easy).
I might be able to tell that this Dodge Dart has had the frame straightened twice and the engine doesn't match the VIN number. But a private fleet vehicle is probably a black box.
AFAIK the odometer reading is only relevant if it's less than 100,000 miles. After that the odometer reading doesn't have to be included on the bill of sale and actual milage doesn't need to be disclosed accurately, by law. Maybe that's not the case in other states but I'm relatively sure it is in Missouri and the law is probably similar in a lot of other states if not identical. So at least in some places, this might be technically legal even if completely unethical.
In some states there's a cut off after so many years. In Washington, it's a very low threshold, like a few years. I've owned something like 25+ cars and I have never filled out the odometer disclosure, since I've never owned a new-ish car.
>1) This is taken from a complaint in a class action lawsuit. Class action lawyers are very similar to patent trolls whereby they can spin almost any story they want. And journalists go for clicks, so they amplify the sensationalism. It doesn't mean this is one of those, but a class action complaint should not just blindly be trusted.
Do you think the rules that apply to patent litigators and class action litigators are different than the rules that apply to other litigators? I really don't understand what you seem to think is going on here, it's a bit naive imo (all the lawyers that I don't like are the bad ones and they lie!)
and I didn't even make it to your next part of your post, where you think that business executives are the honest ones! They aren't. They don't have their own personal license and livelihoods at risk most of the time, unlike attorneys.
>1) This is taken from a complaint in a class action lawsuit. Class action lawyers are very similar to patent trolls whereby they can spin almost any story they want.
The complaint has 4 cited individuals and follows up on an already ongoing lawsuit with a used vehicle dealer that filed a lawsuit in 2017 over being scammed as well.
> There is a strong theme of "of course execs lie cheat steal at every turn" and I also think this narrative should be questioned.
This narrative is "middle-middle management lies, cheats, and steals at every turn and sometimes on other people's turns too".
And while we might question that narrative about execs, we know that it is unfailingly true of middle management. It's not unexpected, that's what happens when perverse incentive is piled on top of perverse incentive. Someone was racing for a bonus. And discovery's going to show that there was some absurd uptick in how many OEM odometers for this model were ordered in the problem years, far in excess of anything that had happened previously.
>1) This is taken from a complaint in a class action lawsuit. Class action lawyers are very similar to patent trolls whereby they can spin almost any story they want.
The complaint class action references 4 affected independent individuals as victims.
But, this entire thing is in parallel with an already ongoing lawsuit by a used vehicle broker that filed a lawsuit in 2017 over being scammed as well.
>...if there was fraud, it was probably committed at a non-executive level by the person whose P&L was directly tied to these resales. Or, it was done independently by the much smaller leasing company where this was more existential to them.
I think most high-level executives are competent enough to create legal incentives and disincentives to their organization which typically are legal. The "lie, cheat, and steal" narrative is about functional outcomes and not so much about explicit follow through.
Executives are in positions they can craft goals and to some degree pass responsibility of details of those goals off to others. I can set unrealistic targets that are only attainable by cutting corners and be sure to make it clear I'll drop people who don't meet those targets or reward people who do. I can leave in-depth questioning about the approach (the potentially dirty details) to create a layer of plausible deniability.
It's as if I hire a driver to take me from point A to point B. That distance may be impossible to cover without violating an array of traffic laws. My goal as the passenger though is to traverse the space safely at some price. I don't really care about how it's done, I'll leave that to the driver. I can create pressure on a driver and/or apply selection bias to choosing a driver willing to take on my impossible request. At no point did I say: violate traffic laws, speed, etc. but I know that's what's going to happen to attain my goal. I never incriminate myself by making the goal generalized and as a passenger, I take on no legal risks for my driver violating traffic laws. Suddenly, using a crafted goal, careful selection, and money, I've created a situation for something illegal to happen. Should I be at fault? What if I even added to criteria of transporting me from A to B not to violate traffic laws but I give a wink wink, shove a little more money (incentive) at the problem, or turn the cheek when it occurs so I don't witness it. Am I still not at fault?
A caricature of this behavior in my opinion is Donald Trump who operates completely in the grey areas wherever possible, pushing or promoting questionable behavior but avoiding the provable cases where he's responsible. From my interaction with various executives over the years, this strategy isn't unique. It's certainly not everyone but impossible environments and requests are made on the daily. It happens from the highest levels and gets passed down and down.
and then selling them at auction with 100,000 ... However, their real mileage was sometimes as much as four times the odometer readout
These numbers matter more here. The Cummins/Allison engine/drive-train in these vehicles are otherwise good for 1 million miles before rebuild on average until they are used as delivery trucks. The constant stopping and starting used as delivery trucks cuts that number down to around 480k miles. So they are selling vehicles that will require engine and transmission rebuilds in less than 80k miles. That's very shady. The engine rebuilds are usually around $10k same as a refurbished engine and the transmission rebuild is around $3k. That does not count the cost to install them.
There's so much more than just the engine, though. I'm dealing with a bunch of aging issues on a car right now. A lot of this stuff won't even show for a few years down the road.
* Shocks and struts wear out
* Catalytic converters are a semi-wear item
* In winter states that use salt, rust absolutely destroys things. I've had the exhaust system rust through on all of my vehicles (simply happens with age).
* Seat cushions, steering wheel, and other high touch surfaces wear. Likely not an issue _now_, but means a few years down the road, these things will be broken.
* Engine accessories - belts, starters, alternators, pumps, etc. Everything is just a bit closer to it's failure point.
----
Most of these issues aren't particularly expensive on their own, but they add up. Further, your expected maintenance is wildly different.
Yea, I thought as much when I saw canadian cars for the first time, coming from a country that also salts liberally (but not with magnesium afaik). Ten year old cars of all makes having completely rusted through wheel arches, just insane.
There is a salt mine up the road from me. The trucks start lining up for miles waiting for loads any time there is a winter storm expected.
The only difference between that salt and table salt is that there is additional processing to the salt done when destined for table salt to ensure purity and shape. So, yes, they don't literally use table salt, but it is the same raw ingredient.
I know of a company importing salt here in Norway. They get boats filled with salt, and when doing the import customs declaration they have to decide if that batch of salt is going on the dinner table or on the roads, because we have half VAT on food and ingredients.
I work in automotive. I think it’s worse but in a different way.
Sodium chloride attacks exposed metal pretty badly.
Magnesium chloride seems to attack powdercoat, e-coat (electro dipped, all cars parts), and nickle coatings, as well as clear coat wet paint seemingly worse. Which then leaves spots exposed to rust. It seems to hang on to the vehicle and attack the entire winter. I’ve found that areas that switch to mag chloride have worse looking vehicles, so, imo, worse.
The magnesium chloride ice melt (which contains other compounds too) has lower toxicity than sodium chloride. That is particularly important for plants and pets.
Everyone in the rust belts should be putting fluid film/woolwax/krown under their vehicles. I think decades of shady "rust proofing" sprayers that were either a scam or did more harm than good (plastic/rubber under coatings) have put people off of doing this but there are products now that work well.
> This winter, a Wisconsin county is fighting icy roads with a homegrown product: liquid cheese brine. Tens of thousands of gallons of the stuff are used each year along with road salt, according to officials in Polk County.
> CONCORD, N.H. (AP) — Looking to strike a balance between ice-free roads and clean waterways, public works departments around the country are working to cut their salt use in winter by slathering the roadways with beet juice, molasses, and even beer waste to make them safer.
I'm surprised they didn't get caught sooner. If it was _just_ an odometer rollback, it should have been easy to catch something being 'off' from a cursory inspection of the vehicle. The wear on things like driver seat bolsters is very different at 100K miles and 400K miles (and even at much lower mileage) and when stuff like that doesn't match the odometer readings, alarm bells should be going off.
The original plaintiff in the 2017 lawsuit popped into the comments section of the parent article, and did quite an amusing "AMA" sort of thing there. He makes a great point by saying something like "I filed this lawsuit in 2017, which means they were made aware of this practice 6 years they're doing this, and are apparently still doing it."
Interesting that the top comment on this thread now is cautioning skepticism on the claims.
I had a 1/2 ton Dodge with a Cummins. The one thing you know or learn fast with a diesel is you change the fuel filter often. Diesel engines are nearly indestructible if the maintenance is done right at the very least the fuel filter.
I've seen a diesel pulled out from the bottom of the bay, scrubbed clean, and installed in a new boat. The old boat caught on fire and sank. The old common rail diesels are damn hard to kill.
Diesels need 3 things: fuel, oil, and coolant. Do not ever skimp on those 3.
I did have a weird thought, in a organisation as big as FedEx, would they have a pool of spare engines to minimise downtime? You could get unlucky and get a can with an engine that's been through a few chassis and end up with an ECU that knows the engine has done 400k miles whilst the chassis has only done 180k?
Although that's probably a mad theory, if there is hijinks it probably is the good old fashioned kind, probably from this 3rd party middleman rather than FedEx themselves though.
A rebuilt engine is your engine where (hopefully) all needed to be replaced parts were actually replaced (locally).
A refurbished engine is another engine (identical to yours) where all needed to be replaced parts were (still hopefully) replaced.
The difference is that (it really depends on a case by case basis) your engine might need less parts replaced and the replacement is done by your local mechanic (all in all it can cost less in some cases).
With refurbished engines all parts in a given list are replaced, no matter their current condition, and the replacement is done by workers that usually do everyday exactly that.
The cost of a refurbished engine (you give them back yours that they will refurbish for next customer) can be a little less (including transport costs) because the refurbisher has spare parts cheaper due to quantity and personnel is faster (because they do this specific work everyday and have all the proper tooling) but often it is very similar.
Your advantages with a refurbished engine are that it is generally faster than a local rebuild, and usually you are offered some kind of warranty (which may not be the case for a local rebuild).
For a company, it is a way to minimize the stop of the vehicle and to place some responsibilities to the external supplier.
Effectively the same aside from time if you are waiting on yours to be rebuilt. One is the engine you have that needs to be rebuilt and the other was rebuilt because someone did a swap and now its inventory in a shop that sells refurbished engines.
[Edit] Adding jaclaz's very good point that one might be able to save money rebuilding their own if it requires less parts.
Some refurbished parts come with a short warranty as well which can help cut risk if the rebuild was done poorly. They come in crates from a factory so the people who did the work specialized and have probably seen all the potential problems.
Agreed that is the direction I would go. The only reason I can think to wait on a rebuild would be if one knows/trusts the mechanic and/or they are having modifications done to the engine for cooling, turbo, fuel efficiency, brackets for different accessories like dual alternators, computer tuning after removing components from the engine, etc...
HN never fails to deliver someone who really sounds like they know what they're talking about. Internet doesn't really corroborate these numbers afaict but hey
I don't really care what the answer is, I just decided to do a tiny bit of my own research to determine whether this confident sounding stranger was right or just sounded right.
I did a few google searches and even asked chatgpt, it's surprisingly hard to get a definitive answer.
The consensus seems to be that after 500,000 miles the Cummins engine will either be dead or need to be rebuilt. 400,000 miles is considered high mileage that few achieve.
So on the surface it seems like you might be right that LinuxBender was wrong. But he did sound quite knowledgeable, didn't he? So I still can't tell one way or another. Ah the beauty of the Internet :).
Part of its lifespan depends on what kind of tuning it has, with some commercial engines being detuned for longevity instead of power output, and if it has extra optional features like additional oil or transmission cooling, or bypass oil filters, and other extras. Consumer vehicles however are often built and designed with lower lifespan expectations and a higher performance profile.
But ive had numerous 90s+ low trim consumer vehicles breaking 300k miles easily and I know some semi-trucks do have 1 million+ miles on the original motor because of such features. And so while I don't have much experience with commercial delivery vehicles, I don't see any big problems with saying they could go a million miles themselves, although due to the nature of delivery driving and driver turnover I would also expect 400-500K miles to be when a rebuilt should be considered unless it was all done by one driver who doesn't drive like mad and they had skilled mechanics maintaining them. And if they didn't care about ruining the engine at some point I would expect 6-700K atleast if it was a well built commercial engine with commercial features.
The issue is that "Cummins engine" is very generic, there are tens of different models, different bore x stroke, different power delivered, mounted on tens of different vehicles (with different weights and suited for different uses).
Even the specific van/truck model Freightliner MT45 seemingly can mount different models of Cummins engines.
Unless you find data for the specific model of engine and truck it is difficult to get valid numbers.
Generally speaking, for heavy trucks and large engines, the 600,000 km (or 400,000 miles) is the mileage where an overhaul (not a whole rebuild) is needed.
In a professional use, unless it is used in shifts, a truck will probably make 40,000 miles per year, so it should happen around 10 years age.
The most common engine on the Freightliner MT45 seems to be the Cummins 6.7, which should be a little more resistant than the older 5.9, both can do 500,000 miles and more, in the "right hands" and with "proper maintenance".
I doubt that used in a fleet (possibly "proper maintenance", but likely a lot of "wrong hands") it can reach 400,000 miles or more, and it makes sense for a fleet manager to sell at an auction the vehicles that are expected to need a large overhaul or a rebuild soon, in the article they talk about the fleet renovation happening around 350,000 miles.
The consumer versions last half as long but that is a fun rabbit hole to go down, an adventure into the oil industry lobbyists, emission controls, etc... but it's a taboo topic here on HN. I do not try to red pill anyone and rather let them venture down the rabbit holes and do their own testing where it is safer to do so.
When did we move to a "do whatever you think you can get away with" model of society?
Maybe I'm naive but I think there used to be at least a modicum of self-restraint on this kind of thing. Sure, people always tried to make as much money as possible, but there used to be some limit somewhere - not because you'll get caught but because c'mon, we just don't do that! That seems to have now been totally lost.
There was never restraint and it used to be much worse. This is why the large body of laws and regulations we have today came into being.
Edit:
Also, in the West society in general is one of abundance with people housed, clothed and educated in school from birth, which IMHO removes a lot of incentives for scams and fraud.
But it used to be (and still is in some countries) that most people were born with nothing in a very tough environment and had to fight just to eat every day. The world of Charles Dickens was real.
>There was never restraint and it used to be much worse. //
I think maybe, in the immediate past in the West it was better.
We still lived and worked more locally, standing with neighbours mattered; corporations had less power than governments; governments were less able to manipulate their citizens, perhaps.
Politicians seem to have learnt to give just enough to quell the riots and pervert the system for maximum financial gain for those who control them; spreading losses across all those being exploited. The UK's conservative government stole something like £30B using preferential contracts in just two areas (IT, PPE supply) during the pandemic.
In the recent past it seems highly unlikely that someone sacked twice for lying, Alexander Boris de Pfeffle Johnson, would get a job as an MP, nevermind becoming PM. In the past it would be inconscionable, now the party seems to shrug and say 'he brings in a lot of a Russian campaign money, lets make him PM'.
In the UK there has been a systematic removal of scrutiny and oversight: choosing BBC management, choosing the civil service boss (it was previously always under open competition), changing the nature of parliamentary oversight, and of course Brexit helps considerably to this end.
I've no doubt it was worse in the middle ages, but considerable doubt it was worse throughout the 20th Century.
I think that part of the problem with politicians now is not necessarily that they are worse than before but that they cannot hide anything anymore and that scrutiny is total.
Before many things were kept secret or could at least be kept out of the press. Now everything is photographed and filmed, and politicians have the bad habit of using messaging apps instead of making quiet phone calls or simply of having a private chat and so they leave plenty of incriminating evidence in writing.
I like your take. The part that's frustrating/interesting is, you would think with all that increased transparency, they would be at least less brazen in their corruption.
It certainly could be that despite the appearances being better in say, 1950-2000, that actual corruption was equal or worse, and most of it went undetected and unpunished!
But my take is that it wasn't as bad, because shame used to exist. A politician would "resign in disgrace" when caught in a medium-to-large scandal (even one that seemed technically irrelevant to their responsibilities, like 'sex scandals'). And he would stay out of public life thereafter, out of shame, knowing he couldn't run for office again and win because of their shameful past. Compare Richard Nixon vs. Bill Clinton.
That's what changed. Now it doesn't matter how shameful and corrupt your conduct was, you just either deny or answer with whataboutism towards the other party's worst sins, and carry on, and for some reason voters are consistently fine with this!
But that's precisely the problem!
Every aspect of the life is over regulated and smaller bushiness are kneecapped
On other side big companies can get away with whatever.
At some states florist is a regulated profession and requires more hours of training than for police.
"For my friends everything, for my enemies the law".
> and requires more hours of training than for police.
Citation? Best I could find is that Louisiana regulates floristry but doesn't mandate education (you need to take an exam). As for taking more hours of training than police I think you are conflating that fact in your head with this: https://www.snopes.com/fact-check/cosmetologists-police-trai...
Besides, I'm not sure how you got here in a thread about how Fedex, a "big compan[y] [which] can get away with whatever" getting caught scamming people.
> Besides, I'm not sure how you got here in a thread about how Fedex, a "big compan[y] [which] can get away with whatever" getting caught scamming people.
Car sales (any many other things) are heavily regulated where I live. Also it seems regulations are not enforced if one is 'too big to fall'.
I just clicked through that link you provided (jobbank.gc.ca) and there's nothing that says florists need "1k hours" of training. It's unclear that they even need to be licensed at all. I also Googled for "license quebec florist" and didn't get any meaningful results.[1]
Can you provide better citation, or point explicitly to the licensing requirements?
Well... I can understand why quite a bit of specialized knowledge would be needed. You have to know your flowers well, know how to operate the refrigeration machinery, what flower keeps at which temperature, what to do if your flowers seem sick etc etc...
Although a university degree "may be required by some employers ", I find this a bit much, however.
Your claim is untrue (that such a certificate is required for florists). The link you provided is to a vocational training program for people who want to specialize in floristry (because they want to open a business). I have a friend here in Ontario who recently went through a similar program for landscaping. It was not required, but it opened a number of job opportunities that would not have been available to them otherwise.
There are only a few jobs which have mandatory qualifications (left column in the link below) and a larger number of jobs which have voluntary qualification courses. There may be secondary requirements (e.g., to work as a butcher and get insurance, your employees must have the voluntary qualification certificate), but these are not regulated professions the way you have been incorrectly claiming on this thread.
Fines are just the cost of doing business and are priced in. Executive crime enforcement and resulting jail time is sorely needed. And not in luxury prisons, but in real prisons where the plebs go. Fines do nothing.
One can dream, the rich at the top write all the rules. It’s not like Joe Average is the one taking golf trips with Supreme Court justices and buying lobbyists to do their dirty work.
It was always like that. At all points throughout history. So law makers put in laws and regulations that had punitive fines on the conduct for businesses. 49 U.S.C § 32703, the law that makes federal odometer fraud a crime, was passed in October 1972 and had a $10,000 fine for screwing with an odometer. If inflation kept up with the punishment it'd be $71,897.64 today. But time passes, fine amounts don't get touched, and eventually it's profitable on the whole to do it. $10,000 if you get caught? That's less than the profit of the deal, so who cares? The conduct resumes.
When you came, you said to me as follows : “I will give Gimil-Sin (when he comes) fine quality copper ingots.” You left then but you did not do what you promised me. You put ingots which were not good before my messenger (Sit-Sin) and said: “If you want to take them, take them; if you do not want to take them, go away!”
> When did we move to a "do whatever you think you can get away with" model of society?
In the late 1980s, Koch Industries stole millions of crude oil each year by instructing their employees to always measure in a way that benefited Koch Industries [1].
Oh, there's a whole list of Right wing nut job orgs. The dominionists who think it's their god given right to rule. The CNP, who think not enough white babies being born. Just to name a couple. They all dump money into the government.
What's normal isn't all that matters though, and the broad consequences of the behavior of the capitalist class are starting to creep quite deeply into what's normal for a lot of middle and lower class people.
Personally, I would like that to be countered much more like how they do things in China. Making an example of some bad apples can be very persuasive.
If anything, suspect on a national / global scale there's far more capacity for society to hold people and organizations accountable than any time in history.
"Accept certain inalienable truths: Prices will rise. Politicians will philander. You, too, will get old. And when you do, you'll fantasize that when you were young, prices were reasonable, politicians were noble and children respected their elders." - Wear Sunscreen
There is so much effort to distort history and the reporting of current events.
If you don't learn history, and then lso not pay attention to what's happening around you, of course you will pine for the good old days when it was easier to control the narrative.
I think you are painting past very nicely, ie DuPont has been knowingly contaminating whole world since 80s at least. That's my childhood years, for sure I wasn't aware of anything similar happening. That doesn't mean it wasn't, news reel was setup differently these days. In 3rd world countries this would not raise eyebrows at all, there were (and still are) big issues around exactly this with used cars in Eastern Europe.
People got addicted to ever more shocking news, I guess 9/11 in the west helped with that. Once you burn your receptors and they go back to flatline, the next kick needs to be a bit stronger to keep people engaged, and next one even more so. So just consuming news is a never ending progression of bad, amoral and over time progressively worse stuff.
Are you kidding? It used to be common knowledge that virtually every used car dealer was committing some sort of odometer or other fraud just 25-30 years ago. The advent of anti-tampering devices in cars, manufacturer certified pre-owned, carfax, listing of odometer values on registrations and insurance forms, and hefty fines (and even prison) for dealer fraud cut down on that.
And quickly realize they were lied to when they were taught things were fair to begin with, which reading between the lines argues that it wasn't fair to begin with. All of which to say, you just reiterated my point.
Because the cost of fraud is far too low and it's now factored into business plans. And no executive at FedEx will go to jail for this. When you can break the law for less than the profits you get for breaking the law, that's just got business sense.
It’s always been this way. Hell, the entire tech industry is this way. No one is innocent, and society is generally fine with it. What might be new is the fact that you hear so much more about it now because of the internet. What was once just local news before is now easily amplified.
Society hasn’t so much as changed as we’ve become more aware of all of the issues. And to top it all off, a lot of people want to go back to that again. Because ignorance is bliss.
Not that I agree with welfare capitalism, I think it’s an unstable position and greed would always kill it. But let’s not forget that for some people, the past was definitely better than the present when it came to some economic matters. Note: I’m not excusing or wanting the bigotry of the past.
That seems much more limited than what I was talking about.
"When did we move to a "do whatever you think you can get away with" model of society?
That's what I was talking about, and it's much broader than what's covered by welfare capitalism.
> But let’s not forget that for some people, the past was definitely better than the present
We are talking about society as a whole. And "do whatever you think you can get away with" implies that it will be better for some people. Just because life it great doesn't mean people aren't doing whatever they think they can get away with. Just because the past was better doesn't change my assertion.
The US had golden years after World War 2. We had abundance, effective institutions, and high trust. We've been slowly coming off of that high for a while, and are returning to what is arguably a more typical state. Our institutions are crumbling, and societal trust is nose diving. Abundance still has a ways to go though.
> We had abundance, effective institutions, and high trust
Yes! Everyone was a millionaire, law was perfect, no intuitions were abusing their powers, no government agencies ran experiments on unsuspecting citizens, everyone was friendly, no one stole anything, no corporation ever lied to the public about dangers of their products, no one was killed, etc! Good old days!
Sarcasm aside, there were things that were better, but also huge amount of things was way worse.
When our shared cultural identity broke down, which I think was maybe late-'90s / early-'00s? "American" used to be practically an ethnicity. Now everyone knows their neighbour isn't like them and doesn't have the same values as them - so you might as well screw them for all they're worth.
> When he sold the truck, his buyer hooked it up to a computer that told them the real mileage was around 400,000 miles.
I’m not knowledgeable about odometers at all, but if it’s as easy as “hooking up to a computer” to get the real mileage, why don’t people do that when they buy the trucks?
The OP posted a comment on the article that addressed this:
>>Tom Layton here, the original plaintiff. I will check back often to answer all your questions.
First off, you cannot check out auction vehicles with OBD scanners or any other engine scan tool because the auto auctions prohibit any such scanners on auction property. Furthermore., of the 500 or so I purchased 99% were purchased online at auctions all over the country. I had to believe what the auction stated on their condition reports.
As far as wondering if FedEx did this on purpose? Both FedEx and Holman were fully aware of this 6 years ago when I filed my lawsuit in 2017. Do you think they stopped? Nope. They continued selling the replaced odometer vans defrauding the buyers right on up to, and including, this year, 2023.
I think that answers the question if they did it on purpose!
Post any questions about this largest odometer fraud in U.S. history and I will post answers periodically.
wholesale auctions operate with a surprising amount of trust, often buyers never actually see the car, they buy based on the specs and description. The vehicle is then shipped to the buyer, and in some cases. the buyer, when finally seeing the vehicle, will get in touch with the seller and say "this isn't "great" condition, this is "good", for _reasons_" and negotiate an adjustment of the price to reflect that. The plaintiff is in the comments of that article and mentions most auctions don't allow computer diagnostics on a car.
Most auctions just don't allow real inspection at all. At best they pop the hood and let you look at the undercarriage or drive the car by for a minute (and quite a few auctions will ask you to pay for even that tiny amount of inspection).
That said - odometer fraud is a big fucking deal here. A vehicle with unknown mileage is worth far less at auction (just the fact that it's unknown is a huge flag) and if the auctioneer was aware of the fraud (as they're implying Holman Fleet Leasing was) then I'm curious to see how this is resolved... a smaller auction house would likely see jail time for several employees.
One would think that the auctioneer would benefit from maximal disclosure, as the present situation as you describe it is precisely that portrayed in Akerlof's "The Market for Lemons":
Moreover, many states require regular smog checks, at least on passenger vehicles (though I'm not sure what the situation is for commercial vehicles). These entail a comprehensive electronic data record, much of which is automatically captured from the vehicle, and which is available for sale. Auto insurance companies have used these data for years, if not decades, to set policy rates as miles driven is a principle driver (ahem) of risk.
If VINs are avaiable for the vehicles being auctioned, it's possible that a service such as CARFAX might carry such data. I suspect bulk / corporate buyers would tend to have access to such information, whilst small-time operators / individuals likely would not, which throws an additional bias into such auctions.
The auctioneer knowingly keeping a secret that could cause a downturn in the market once discovered and publicized in years and in the meantime keeping a giant client sounds very rational.
Auctioneers would simply have a standard practice with respect to disclosure to protect their reputation, not keeping secrets. I know of none that advertise that they use a computer to verify the mileage/hours on equipment - if one did I am sure they would advertise it and be religious about its execution.
> Most auctions just don't allow real inspection at all. At best they pop the hood and let you look at the undercarriage or drive the car by for a minute
Why is this? Just a time restraint thing, or what? I don't understand why an auction wouldn't allow bidders an opportunity to check out the product before they purchase. The pessimist in me would say it's in the auctioneers best interest to give as little information as possible, in order to get the highest bids, but it seems odd that this sounds to be a standard practice.
Shouldn't bidders insist on at least a single 3rd party to say the mileage for the crowd?
Well it's being sold at auction, not by the first party and it's very likely that any questions a bidder has can't be answered anyways. You take your chances and the payoff is a good deal for you. The auction makes money from volume.
I agree though that changing the odometer is criminal to do. But one shouldn't be buying cars at auction unless they know what they're doing. Buying a used FedEx van at auction comes with a few known... stipulations.
I've noticed that these commercial auctions conspicuously do not publish the mileage in the listing, just a photo of the odometer. It's interpretation is up to the buyer. That behavior should tell you something.
A generic OBDII scanner that will read mileage and engine fault codes is not expensive, they are on Amazon and other sellers. The better ones run up to several hundred dollars. For some things you do need the manufacture's software but not for reading mileage and standard fault codes.
Automotive repair products are oriented around business purchases and sales, so everything is expensive, and designed for professional repair of either lots of various customer vehicles or a managed fleet of vehicles.
>wholesale auctions operate with a surprising amount of trust
Just to correct this - auctions operate with a whole lot of caveat emptor
which is why auctions are supposed to be relatively "value buys".. in an auction transaction.. if you're not sure if you're the sucker... then you're the sucker.
Living in a country with rampant odometer tampering: it often requires specialized diagnostics scanner and knowledge where to look (which is different for various vehicles).
For example, on a VAG car, most generic diagnostics scanners just report the mileage as it's recorded in non-volatile memory in ECU/odometer/transmission (which people know how to change).
But a specialized scanner (VAG COM, for example) also displays freeze-frame information of diagnostic faults (and this sometimes includes mileage, depending on the module).
If the people doing corrections change the mileage reported by major modules that contain this information but do not bother to erase diagnostic faults, you can sometimes find the real mileage, as recorded by electric seat module which detected undervoltage condition when the battery was removed, or headlight module when the bulb burned out.
Deleting the DTCs is really trivial. It's just a standard UDS command. The only way to avoid this kind of scam is buying vehicles that have done the official maintenance/inspection. That will report the odometer to the car maker.
> The only way to avoid this kind of scam is buying vehicles that have done the official maintenance/inspection.
Agree, but not everyone here can afford <5 year old vehicle, so people have to do with the means they have. As soon as warranty/lease ends, people generally go with cheaper, non-manufacturer maintenance shops.
Presumably this was through auctions like copart. They operate on the basis of “this is the info, these are the pics, good luck!”.
Now, if, for example, you buy a car that is advertised as runs & drives and it turns out the car does not, in fact, drive - you can talk to them and have them buy the car back or whatever. This happens every now and then. But aside from that, you’re SOL.
I’ve purchased a number of cars from them, and one issue that comes up fairly often is that they load the cars via forklift. Often, the forklift will cause damage to the underbody that was not present previously. In cases like that, you’re still pretty much SOL.
IIRC, in most cases these computers and software are very expensive. Also getting one can be very difficult in many places depending upon the Laws. The Auto Industry really only wants dealerships to have these.
Will it read all the manufacturer-specific clusters needed to confirm odometer fraud on this model of vehicle?
I use my $20 eBay OBD2 all the time on my Mk4 Jetta to confirm faults. However, even with such an old car with decent support, there are many things I'm unable to do or see.
The OBD port can easily spit out a read only mileage reading which is not tampering with the recorded value in the ECU. The OBD port is supposed to be user accessible and usable by the end user and 3rd parties (at least in the EU) even though manufacturers are trying their hardest to put “non diagnostic data” behind their proprietary software and/or wireless comms. Reading the data from the OBD port isn’t (at least shouldn’t) be classed as tampering.
One of the ways tampering happens on digital dashes that read the mileage from the ECU is by putting a interceptor in between the dash and the ECU as it’s easier than reprogramming the ECU. https://youtu.be/f4af1OBU5nQ
This comment was not clear. Odometer in car computer can be changed too. There exists special obd command to do this (when you need to replant ECU between engines), but you need to have a password (which is provided with "official" diagnostic computers/tools). If car has no mechanical odometer (most new passenger cars today don't), this is the only way to change odometer values.
This is not how odometers are scammed. The EEPROM gets rewritten to zero, then you can increment the odometer to your preferred value via OBD/UDS. Please note that you can only increment the odometer without a specialized (authenticated) diagnostic session.
FYI I do not reset odometers, I am on the other side, developing software for instrument clusters.
I have doubts that we're getting an accurate story here, I know it's trendy to hate big companies but this seems like a really stupid thing to do and something you're likely to get caught doing if you're doing it on every truck.
Anyone buying used delivery trucks knows they get driven all day every day until it's uneconomical for the owner to continue operating them. Hundreds of thousands of miles. It would be very unusual to see one for sale with under 200k miles, that's "just getting broken in" for trucks like this.
I'm even surprised that these trucks have mechanical odometers. I havent's seen one in a passenger car in many years, they are all digital, rarely fail and (I assume) would be harder to tamper with.
>I have doubts that we're getting an accurate story here,
Well that's the magic of the court system, the filing of the lawsuit is to either get them to settle/admit wrongdoing or to force this to discovery.
>I'm even surprised that these trucks have mechanical odometers.
Freightliner vans aren't fancy hi-tech vehicles, they are utility vehicles.
But there's no difference between mechanical and digital odometers here. If you swap a digital cluster, you end up swapping the odometer reading. Architecturally vehicles have seldom moved on from storing the reading in the cluster.
It really becomes a question of where do you store the reading? A engine computer is more likely to be replaced due to an accident than the odometer in the car even though on many vehicles it will still track the mileage.
>they are all digital, rarely fail and (I assume) would be harder to tamper with.
Actually, in most cars they are absolutely tamperable over CAN or physical access. If I remember right, the Honda digital cluster even up to my 2021 just has a standard SPI flash chip that you can tamper with to change the odometer value.
Depending on the manufacturer the digital odometers are even easier to tamper with. There are a dozen people on my local craigslist that will reset/rollback odometers for you for $100.
The article is dealing with a real lawsuit and it has many different members of the class action in multiple different states. They will have to prove their case in the court so it is unlikely that it is completely made up. There does seem to be a pattern of behavior here.
A close reading of the article leaves room to doubt whether FedEx was complicit in the alleged scheme. I’m not surprised to see that FedEx denies the allegations. Given that there is another defendant in the lawsuit I suspect there is more to this story than what’s been presented here.
not very much room... the companies weren't all that separate and fedex profited off the alleged fraud
>>> FedEx started auctioning old vans off through its fleet company, Holman Fleet Leasing (also a defendant in the lawsuit). The lawsuit alleges that both FedEx and Holman intentionally replaced the odometers to artificially inflate the values of the vans, so they'd sell for higher prices at various auctions throughout the United States. Then, according to the accusations, both companies would split the profits.
The allegation is that both FedEx and Holman were involved, yes. If FedEx can produce an audit trail showing that the vehicles left FedEx facilities with true odometers then I don’t think Holman stands a chance.
Or if FedEx can produce an audit trail indicating the odometers were faulty and had been replaced. A vehicle with 400,000 miles has seen a lot. If the dash gauges were replaced around 220,000 miles, then 180,000 miles have passed since then - and the new odometer will read 180,000.
It is normal practice to replace a broken odometer with a new one. That is not fraudulent. However, when that vehicle is sold the seller is legally required to flag the title.
A lot of liability depends on why the odometer was replaced, who transferred the title (does FedEx transfer the title to Holman before sending the vehicle to auction, or does Holman hold the title the entire time?), and whether the title was appropriately flagged as "Not actual mileage".
All I can think is "why would you replace every odometer if you weren't committing fraud?". Like that costs money and time to do. Were they all broken and needed replacing?
And if you aren't committing fraud and there's a reasonable reason to do this, why not do it just before sale? Why drive another 100k on them afterwards?
Some odometers have common problems. For several years Toyota's digital odometers had a bug that caused them to stop counting at 299,999 miles. Porsche's mechanical odometers from the late 1970's through the mid 1980's had a plastic gear that tended to strip out and cause them to stop counting at some random point.
It is possible FedEx's odometers all came from the same supplier and all had a MTBF of around 300,000 miles - which would explain driving another 100k miles before selling the trucks when they reach 400,000 miles.
The lawsuit accuses FedEx of replacing the odometers in many of its vans with new ones that read zero miles, using the vans for a bit longer after that
Being born into a 5 digit odometer world and growing up around people who learned every way possible to suss out mileage - this seems nuts to me. How could they think that zero people would suspect and investigate an odometer swap?
Past that, how could so few company mechanics notice a discrepancy between mileage and wear - that no whistleblowers came forward?
Company mechanics don't give a fuck that's why, either they are underpaid and/or underpressure to get as many vehicles done each night as possible. (Read up on how the mechanics trade works in general and its pretty shit, mechanics are often paid on minimum wage + "commission" on amount of work rushed through). It's not a field that people are going to stick their necks out and make themselves unhirable either.
In this case FedEx outsources the work to a fleet management services company to remove even more liability from themselves.
Complete shot in the dark, but I bet culpability lies with FedEx's thousands of subcontractors. Their van lease agreements with FedEx obviously benefit them if they return them with fewer miles. Given that a great deal of contractors tiny family businesses, it doesn't surprise me that enough of them tried to eek out more profit for people to start to notice.
I find this hard to believe. The claims of both lawsuits are basically the same. The FedEx routes are all independently owned. The route owners are responsible for fixing their vehicles. Parts get replaced constantly. Its a never ending mechanics job to serve these fleet vehicles.
As a public company, FedEx undergoes routine audits. Do accounting firms audit vehicle mileage? I'd assume that vehicle depreciation is is an important part of the balance sheet calculations at Fedex, and that mileage might be audited as part of the depreciation functions.
> Tom Layton of Henderson, Nevada first noticed FedEx's odometer rollbacks in 2017. Layton, who's been buying and selling trucks and vans for 36 years, bought a FedEx Freightliner truck with around 180,000 indicated miles. When he sold the truck, his buyer hooked it up to a computer that told them the real mileage was around 400,000 miles.
And yet another reason to ensure "Right to Repair" Laws are passed and enforced.
Right now, one state, I forgot which, was informed by the auto industry they will ignore the law. I do not know if enforcement has started yet.
We only know that “buyer hooked it up to his computer and said [something]” - how does that strengthen an argument for (or against) right to repair, exactly?
Thanks for the link. Instructed by the federal government not to comply seems quite a bit different than what gp is implying. Why would legislators bother considering the full implications of their bills?
I remember hearing a story of a car rental doing this on a systematic scale. When they were caught, they acknowledged a "mistake" and offered to reimburse difference in price.
However, they were caught fiddling the mileage again on the 'reimbursed' cars (not upping it enough). They were caught for the second time because the catalytic converter had a chip that counted every 250 miles or something along those lines.
Doesn't surprise me, they didn't give me a cost of living increase for over a decade and new hires were making almost as much as I was when I quit after 15 and a half years (office job), along with about half the office quitting within a year.
The phrase “corporations are people” is somewhat ambiguous. It does not mean that every corporation is a person, it means that corporations are _composed of_ people. (Think “soylent green is people”, if it helps you understand.) The people in a corporation have rights, and thus any action taken by a corporation may be an expression of those rights. A corporate press release has just as much protection from the first amendment as any other statement a person might make.
The people in a corporation can and do get sent to jail, even if the corporation itself does not.
Maybe it has something to do with talking a package from Southern California, to Florida, to Texas, delay shipping twice, and then back to Northern California. If I need the item and I see FedEx as the shipping agent, I go look elsewhere.
The lawsuit states that a number of people from different states are making the same accusation. That the trucks were utilized by Fedex for nearly 200k miles after the odometer swap is a worthwhile indicator that Fedex was complicit.
The problem is, it's not illegal to alter your odometer and drive it yourself.
It is illegal not to report the odometer misreading in a sale. The real question is, who make the odometer change and where did the intentional or not breakdown happen on failure to report the odometer inaccuracy.
> The real question is, who make the odometer change
Better stated, I think, as who knew the odometers were changed out to zero reads, before the vehicles were then driven another ~200k miles.
Trying to craft a scenario where no one at FedEx had any knowledge at all that their well used vehicles suddenly had zero miles seems like low-return effort.
For an even better question, why undertake that specific project (at scale) except to perpetrate fraud?
"It isn't illegal to replace odometers and it isn't even illegal to sell vehicles with odometers that have inaccurate mileage readouts. However, to do so, a disclaimer needs to be made by the seller, indicating to the buyer that its mileage readout is inaccurate and that the odometer was replaced."
How is it even legal? "You can lie but you have to admit to it".
If your odometer breaks and you need to replace it, what else are you supposed to do?
It has to be legal to have an incorrect odometer reading otherwise, unless the odometers are easily changed to display arbitrary readings, entire cars are scrapped as soon as they need replacements.
Particularly with company/fleet trucks or cars, you normally have an "own" paper log with all the repairs and maintenance performed, so, if you are in good faith, if the odometer breaks at (say) 190,000 miles and the new one reads 110,000, you can easily prove that the vehicle is at 300,000.
When you sell that vehicle only stating "odometer reads 110,000" you are inducing the buyer into error (lying by omission, and you are in bad faith as you have the documents that reveal the real mileage).
For those rare cases where there is no such documentation there is usually the formula "mileage unknown" or similar, but usually it draws the price down to the minimum.
Because you're not lying at that point? You've just told them that the odometer reading is wrong, and unless you can find some other way to backup your mileage claim, they'll just be priced as if they were nearly maxed out?
That’s the difference between fraud and not-fraud right? “It’s not illegal to install a new odometer unless you lie about the odometer reading for money” doesn’t seem like a contradiction to me.
Perhaps this should be possible? If nothing else, it should technically be possible to hook it to a load and run the odometer up to what it should be. You'd have to be careful not to overshoot, since you can't reduce the value on an odometer if they're properly designed.
It'd still be useful to denote "this vehicle has had the odometer replaced, but care was taken to ensure the odometer value is within +/- 1% of the authentic value"
Of course, this is really only for mechanical-style odometers. Digital ones, I know almost nothing about, wouldn't surprise me if there is no "stored mileage" in such an odometer.
If the replacement process is controlled (in the technical sense of the word) then yeah, you have room to make the case that your title should not have an asterisk next to it saying the true mileage is unknown.
>odometers, as automotive components, do occasionally wear out or malfunction and need to be replaced
In many vehicles the mileage is stored in an engine control unit and the odometer is simply a digital display. In others it's stored electronically in the instrument cluster. What if you need to replace a faulty ECU or instrument cluster? There are ways to reflash that data so replacements are accurate.
If you're selling a vehicle at auction, typically it's as-is. So if the ECU or cluster are having problems and can't read out the mileage, it seems unfair to make it illegal to sell.
A disclaimer isn't admitting to lying. It's admitting that the reported value could be inaccurate. That seems to be the most fair requirement in an auction scenario.
Sometimes you need to replace the odometer (or the module it’s built into) and you can’t always update the new one with the correct value. Sometimes parts break and the odometer is no longer accurate, it’s reasonable to say you can still sell a car in that condition if you disclose the situation
One alternative is to require that the new odometer is wound forward to match the old odometer's value. But I'm not sure if odometers have this capability.
Even if they do that would require you catch the error fairly quickly. I'm not sure how long it would take me to realize my odometer was broken, honestly.
You can use the speedometer check zones on the Interstates to check this, Just note the value at the zero sign and when you pass the last sign note the value again and do the math.
I believe the comment that you're replying to might mean that they wouldn't notice if their odometer was totally broken and didn't increase at all. I am the same. I assume the mechanics would notice when the yearly inspection showed the same odometer reading as the previous year.
1) This is taken from a complaint in a class action lawsuit. Class action lawyers are very similar to patent trolls whereby they can spin almost any story they want. And journalists go for clicks, so they amplify the sensationalism. It doesn't mean this is one of those, but a class action complaint should not just blindly be trusted.
2) There is a strong theme of "of course execs lie cheat steal at every turn" and I also think this narrative should be questioned. Ethics aside, the level of compliance in a public company is insanely high. Execs are already rich. To risk jailtime, which fraud can lead to, you'd need to see something more existential than slightly increasing margins on used van sales.
I felt inclined to comment as I've been on the other end of articles like this, and it is astounding the level of mind reading people have done into my intent and actions on things that were factually just not true at all. I also truly would find it very difficult to commit a broad organizational fraud even if I wanted to and my company is only 500 people.
If I had to make a prediction, the case is less black and white than it appears, and if there was fraud, it was probably committed at a non-executive level by the person whose P&L was directly tied to these resales. Or, it was done independently by the much smaller leasing company where this was more existential to them. It is highly unlikely to be a Fed Ex executive-level conspiracy.
I'm sure there are a few counter examples, such as say the VW emissions scandal, but I would counter these were the exceptions that proved the rule and in general when the C-level was involved was much higher stakes.