The modern world of Corporate America runs on email and web-based applications; consequently, employees of Corporate America are continuously sending emails, at all hours of the day and night, using their corporate email accounts. These emails, which must be automatically archived by the corporation in order to remain in compliance with data management regulations, frequently end up creating costly problems. Corporations must avail themselves of behavioral modification tools to break the expensive habits that employees armed with smartphones and mobile work email accounts have formed. Email communications can and have captured dishonest and illegal activities on the part of employees, but that is a larger issue than I can address here today. In this article, I will discuss only the relatively simple case of email "foot-in-mouth" -- offhand comments made in the course of a conversation that later could be misinterpreted in a negative way.
One major problem is an information gap between top executives and mid- or lower-level employees. While IT security personnel may have educated the execs on proper "email hygiene" and the permanence of email, other employees may be quite unaware of that aspect of their communications. The assumption that emails can be deleted by simply moving them to the trash folder is inaccurate and can lead to serious trouble for an organization.
Take, for example, a case that emerged in the recent banking crisis: mid-level Goldman Sachs trader Fabrice Tourre, known jokingly to his co-workers as "Fabulous Fab," sent several emails touting the role of the products he was selling in the looming banking catastrophe. "The whole building is about to collapse," he wrote, "anytime now ... Only potential survivor, the fabulous Fab ... standing in the middle of all these complex, highly leveraged, exotic trades he created without necessarily understanding all of the implications of those monstruosities [sic]!!!" This email, among others, implicated Goldman Sachs with knowingly misleading investors. While the suit eventually resolved in Fabrice Tourre being found liable for fraud , Goldman Sachs suffered from a major loss of reputation and endured a great deal of media outrage. Ethics and business practices aside, Fabrice Tourre clearly did not understand that anything written via a company email client, to paraphrase the Miranda warning, can and will be used against its author and indeed its host company as well.
Another example involved the London Interbank Offered Rate, or "Libor," which is a key interest rate estimated by major London banks in order to determine the rate that a bank would pay if it borrowed money from other banks. This rate is then used throughout all lending that those banks conduct, thereby affecting borrowers throughout the world. In December of 2012, amidst the infamous Libor-rigging scandal, the UK's Financial Services Authority's report quoted UBS employee-emails blatantly manipulating and attempting bribes to control the Libor: "If you keep 6s unchanged today ... I will f---- do one humongous deal with you ... Like a 50,000 buck deal, whatever ... I need you to keep it as low as possible ... if you do that ... I'll pay you, you know, 50,000 dollars, 100,000 dollars... whatever you want ... I'm a man of my word." The email from which that desperate and unethical request was cited, along with a host of others in a similar vein, are both incriminating and highly embarrassing for UBS.
Despite the many high-profile cases involving email evidence, employees in corporate America still send these foolish emails. Employees and employers alike must remember that whether or not an employee email actively implicates the employee (and therefore the company, by association) in a very public criminal investigation with hundreds of millions of dollars on the line, such emails can still severely damage a company's business and reputation. In some cases, the loss of reputation can in itself be a killing blow. When it comes to modern court cases, email evidence often comprises the difference between a winning and losing lawsuit.
It is beyond refute that for every email sent, there's an excellent chance that someone, or many persons, may have kept a copy: the individual (both the sender and any receivers), the company mail server, the backup provider for either the sender or receiver, or the smart phone from which the email was sent. Regulations require that companies archive emails to some extent, and major companies who are under major scrutiny must store all their data to the furthest possible extent of technology. There are very few cases in which it is impossible for data to be retrieved or restored. How, operating in a world where any unthinking (or unethical) email sent by an employee could mean their employer's downfall, are companies to protect themselves?
I will leave the ethics education for companies to handle on their own. As for protecting against email folly, the solution is simple: use a tried and tested behavioral modification approach. Put a program in place that clearly outlines your company email policy (I recommend teaming this with a BYOD policy for the greatest effect), and includes examples of email communications that are prohibited during working hours, from company email clients and via company machines. Let employees know that if they send an email violating any one of those policies, the company will take immediate action against that person. This means that the next time an employee sends out, for benign example, a personal email about an eBay transaction while at work or via a work email account, the company will notify the user that such email communication is prohibited and notate the infraction on their employee file. While this change in policy may be draconian, employees will adapt much faster than one might think, and it will alleviate the worries of countless legal counsels, IT security professionals, and indeed the employees themselves -- this policy protects them as well, removing the risk of having their personal communications examined in a court of law.
Daniel B. Garrie is the executive managing partner at www.lawandforensics.com. For more information, or with questions and comments, please email at Daniel@lawandforensics.com. Daniel would like to thank Kelsey Fredston-Hermann for her editorial assistance on this article.