Buffett's Berkshire says Sokol violated policies
By Josh Funk |
April 29, 2011, Friday
|
Print Edition
Print Edition
BERKSHIRE Hathaway said on Wednesday that a former executive believed to have been in line to succeed Warren Buffett as CEO violated the company's insider trading and ethics policies by buying stock in a chemical company Berkshire is acquiring and failing to disclose key details.
Buffett released a report that Berkshire's audit committee produced after examining David Sokol's US$10 million investment in Lubrizol. It's not clear whether Sokol will face any additional sanctions because the company says its policies set a higher standard than the law does.
Sokol's lawyer, Barry Levine, issued a statement later disputing the findings.
Sokol quit Berkshire shortly after Buffett's Omaha company announced plans to acquire Lubrizol for US$9 billion. When his resignation was announced late last month, Sokol said he was leaving to start his own firm.
The audit committee said Sokol offered "misleadingly incomplete disclosures" about his Lubrizol trades, which were made while he was scouting acquisition candidates for Berkshire.
The committee said even if Sokol's actions could somehow be justified, they would still violate the standard Buffett establishes when he periodically encourages all Berkshire managers to avoid any behavior that even comes close to being unethical. Buffet sends a letter to his managers every two years reminding them to "zealously guard Berkshire's reputation."
Sokol's lawyer Levine complained that Berkshire's audit committee hadn't interviewed his client for its report.
But Berkshire board member Ron Olson said in his own statement that Sokol had been interviewed at least three times before refusing to answer additional questions.
The new report on Sokol's actions was released ahead of tomorrow's Berkshire Hathaway annual shareholders meeting. Buffett and Berkshire Vice Chairman Charlie Munger are almost certain to face questions about Sokol at the meeting. Berkshire said on Wednesday that it would release a transcript of any questions about the topic on its website afterward.
Andy Kilpatrick, the stockbroker-author of "Of Permanent Value, the Story of Warren Buffett," said this new report should defuse the Sokol issue before the meeting, and it appears Berkshire wants to answer all questions. "I don't think Berkshire did anything wrong," said Kilpatrick, who is also a shareholder. "It's just that they were deceived."
Buffett released a report that Berkshire's audit committee produced after examining David Sokol's US$10 million investment in Lubrizol. It's not clear whether Sokol will face any additional sanctions because the company says its policies set a higher standard than the law does.
Sokol's lawyer, Barry Levine, issued a statement later disputing the findings.
Sokol quit Berkshire shortly after Buffett's Omaha company announced plans to acquire Lubrizol for US$9 billion. When his resignation was announced late last month, Sokol said he was leaving to start his own firm.
The audit committee said Sokol offered "misleadingly incomplete disclosures" about his Lubrizol trades, which were made while he was scouting acquisition candidates for Berkshire.
The committee said even if Sokol's actions could somehow be justified, they would still violate the standard Buffett establishes when he periodically encourages all Berkshire managers to avoid any behavior that even comes close to being unethical. Buffet sends a letter to his managers every two years reminding them to "zealously guard Berkshire's reputation."
Sokol's lawyer Levine complained that Berkshire's audit committee hadn't interviewed his client for its report.
But Berkshire board member Ron Olson said in his own statement that Sokol had been interviewed at least three times before refusing to answer additional questions.
The new report on Sokol's actions was released ahead of tomorrow's Berkshire Hathaway annual shareholders meeting. Buffett and Berkshire Vice Chairman Charlie Munger are almost certain to face questions about Sokol at the meeting. Berkshire said on Wednesday that it would release a transcript of any questions about the topic on its website afterward.
Andy Kilpatrick, the stockbroker-author of "Of Permanent Value, the Story of Warren Buffett," said this new report should defuse the Sokol issue before the meeting, and it appears Berkshire wants to answer all questions. "I don't think Berkshire did anything wrong," said Kilpatrick, who is also a shareholder. "It's just that they were deceived."
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 娌狪CP璇侊細娌狪CP澶05050403鍙-1
- |
- 浜掕仈缃戞柊闂讳俊鎭湇鍔¤鍙瘉锛31120180004
- |
- 缃戠粶瑙嗗惉璁稿彲璇侊細0909346
- |
- 骞挎挱鐢佃鑺傜洰鍒朵綔璁稿彲璇侊細娌瓧绗354鍙
- |
- 澧炲肩數淇′笟鍔＄粡钀ヨ鍙瘉锛氭勃B2-20120012
Copyright 漏 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
