Posted by Cody Wimmer.

Recently AstraZeneca made a statement warning Britain that pharmaceutical companies may be moving out and away from Britain due to their low-funding and exit of the European Union. In Britain, funding for clinical drugs goes through the National Institute for Health and Care Excellence (Nice), “which is based on how cost-effective a drug is.” The issue lies in the fact that many of these drugs are very expensive and serve only to help a few patients with very rare diseases or cases. Nice is not as interested in funding those projects as it is in funding projects that could help more people.

Not only is there a lack of funding from the UK, but since they left the European Union the market in which to sell the products has become much smaller. Before the exit Big Pharma companies could freely trade between the EU with a very little extra cost, but that cost has grown substantially to the point where they might have to look elsewhere.  Lisa Anson notes “England spends £6,500 a head on medicines per person. By contrast, in France and Germany it is £12,000 to £13,000.” This shows that not only is the market much smaller in terms of the people that could potentially need the medication, but also that the UK is less willing to spend money on the research and the medication itself.

If the UK does not soon change the way they look at and fund medical treatment they will start to greatly fall behind the rest of Europe, if not the world. They no longer can rely on their European Union trading nor their outdated government health care spending to keep them afloat and keep them ahead in terms of research. If they want to have a chance to keep the pharmaceutical companies in the UK they are going to have to make some major changes in their health care system.

Cody is an information technology management major at the Stillman School of Business, Seton Hall University, Class of 2018.

Posted by Katherine Harris.

This article brings up the question whether or not a company has liability in how or when the customer uses their product. In this case, Ashley Kubiak was driving her Dodge Ram truck, as she checked her iPhone for text messages. Kubiak then crashed her truck into another vehicle killing two people and paralyzing a child. This is just one case of distracted driving that we have seen a rise in throughout the past 50 years. The families of the victims have sued Apple because, Apple knows that their devices are distracting to drivers, but did not prevent Kubiak from using it while driving.

While a Texas magistrate made a suggestion to dismiss the case on the grounds that the lawyers could not prove the iPhone caused the fatal accident. “Ms. Kubiak was convicted of negligent homicide and sentenced to five years on probation” (Richtel). Kubiak now leaves her phone in the back seat to avoid the temptation of using it while driving. This case of Apple’s iPhone product liability puts Apple in a difficult situation. Especially, because Apple has the technology to prevent texting while operating a motor vehicle, but has not implemented it.

Although, there are laws and public education initiatives against distracted driving, Apple, Verizon, and AT&T acknowledge the effectiveness of these campaigns. Deborah Hersman, the president of the National Safety Council and the former chairwoman of the National Transportation Safety Board said it best, “The technology exists – we just don’t have the stomach to implement it” (Richtel). Implementing the technology to turn off text messaging while someone is driving brings up questions about the economic, social, and ethical concerns.

Katherine is a marketing and economics major at the Stillman School of Business, Seton Hall University, Class of 2018.

Posted by Melani Filosa.

The Consumer Product Safety Commission, a regulatory committee created by the Consumer Product Safety Act enacted in 1972, regulates all consumer products in order to protect the buyer. They promote safety by issuing recalls, developing standards, and requiring warning labels. Because this committee regulates consumer products, they first needed to define exactly what fell under the tile of a “consumer product.” The definition can be found in Section 3 of the CPSA (Consumer Product Safety Act) linked here https://www.cpsc.gov/PageFiles/105435/cpsa.pdf. The act creates exact parameters of what the CPSC can regulate, which excludes all firearms and ammunition. The exact language of the Act reads “The Consumer Product Safety Commission shall make no ruling or order that restricts the manufacture or sale of firearms, fire-arms ammunition, or components of firearms ammunition, including black powder or gunpowder for firearms Section 3(e) of P.L. 94-284 [S. 644]; May 11, 1976,” generating the obvious question: should firearms be included in the definition of “consumer product,” or would that type of regulation be unconstitutional. Because the debate over gun use has been in the spotlight, it is important to know the argument for more regulation and that against it. This post will aim to inform only, in the hopes of creating knowledgeable voters on either side of the issue.

The Trace, an online news media source whose mission is to “close that deficit through daily reporting, investigations,” wrote an article titled “Cars, Toys, and Aspirin have to Meet Mandatory Safety Standards. Guns Don’t. Here’s Why,” written by Olivia Li. The argument in favor of expanding the definition often relies on the popular gun/car analogy, used by individuals and President Obama alike. Here is essentially how that analogy goes: automobiles have regulations, such as seatbelt use and airbag regulations, in order to protect both drivers and pedestrians, and we have also created regulatory agencies to oversee that automobiles are built to meet these standards. At the same time, there are no regulations or oversight in the creation of guns, which are arguably used in households and therefore a consumer product, just like a car. Li writes:

No federal agency oversees how firearms are designed or built. While the federal government can mandate recalls of unsafe toys, polluting cars, or even discolored medications, it’s unable to recall defective firearms. There is also no system in place to track accidental deaths caused by malfunctioning weapons. Rather, the firearms industry self-polices its products, establishing its own design standards and initiating its own voluntary recalls.

This quote captures the essence of the argument in favor of expanding the definition. If every other product used by a consumer, which is pretty much everything, can be regulated, why should guns be any different. It is important to note, however, that there are safety standards imposed by SAMMI, Sporting Arms and Ammunition Manufacturers’ Institute, yet these standards are voluntary. Those who wish to expand the definition believe these regulations should not be voluntary and gun safety should not “fall on the shoulders of the gun owner,” but instead by mandated by the federal government and regulated by in agencies.

Again, the question asked by those in favor of expanding the definition is why are guns different than other products, which leads to the argument against the change to the definition. The two major arguments from this side are 1) there are regulations, and the gun manufacturer can only be held responsible to a point, and of course 2) the Second Amendment. The first defense, argued by NPR on their “Break it Down” page, where they breakdown what candidates and politicians say and fact check their statements. The article entitled “FACT CHECK: Are Gun-Makers ‘Totally Free of Liability For Their Behavior’?” points out that, in fact, gun companies are liable for their products in certain instances and are responsible for meeting standards and regulations. This leads to the arguments against expansion of the definition. They essentially argue that with more regulations, gun manufacturers will unfairly be held responsible for misuse of guns, turning the gun/automobile analogy on its head saying car manufacturers are not held responsible for drunk drivers. This argument relies on the gun doing what it is intended to do. As Kortzleben states “If you aim and fire a gun at an attacker, it’s doing what it was intended to do.” Finally, the Second Amendment argument states that the U.S. Constitution does not allow for the same regulation of guns, and that any changes to include guns as a consumer product would be unconstitutional, which again can be found in the CPSA itself.

As one can easily see, after reading the arguments on either side of the discussion, the authority and legality to include guns and firearms under the definition of consumer product is unclear. Both arguments root themselves in the American legal system. For this reason, it is imperative to understand the discussion and confront the proposed problems in either argument, creating an informed constituency who cares about their rights and the issues. The argument over gun control is not going anywhere, and therefore it becomes each of our duty to know the debate.

Melani is an English major with a minor in legal studies at the Seton Hall University, Class of 2018.

Works Cited:

https://www.cpsc.gov/PageFiles/105435/cpsa.pdf

https://www.thetrace.org/2016/01/gun-safety-standards/

http://www.npr.org/sections/itsallpolitics/2015/10/06/446348616/fact-check-are-gun-makers-totally-free-of-liability-for-their-behavior

Posted by Michaela Jerkowski.

In recent events, McDonald’s Restaurants settled a labor lawsuit pending from 2014, and was ordered in federal court to pay $3.75 million dollars to about 800 employees in California. The lawsuit states that Smith Family LP, who franchised five restaurants in California, “violated California law by failing to pay overtime, keep accurate pay records and reimburse workers for time spent cleaning uniforms.” (Fortune 6).  The case was the first time in history that McDonald’s settled a class action law suit that was filed by franchise employees.

Over the past couple of years, McDonald’s has dealt with multiple different problems involving franchise employees. Aside from this multi-million dollar lawsuit, they were also hit with a sexual assault lawsuit involving 15 franchise employees. The McDonald’s corporation has been in and out of court trying to find out whether or not they are considered joint employers with the franchise owners who are causing this backlash with employees.

Although you might think that this lawsuit isn’t much of a high profile case, considering McDonald’s is a billion dollar company, the reason it’s been brought so much attention is because it’s the “the first time the company has settled legal claims by a group of U.S. workers at one of its franchises.”(Time 1). This lawsuit could open doors for many more that may appear in the future, so it would not be a surprise if the company now gets hit with more lawsuits.

Michaela is an accounting major at the Stillman School of Business, Seton Hall University, Class of 2019.

Sources:

http://time.com/4552835/mcdonalds-settlement-labor-law-california/?xid=IFT-Section

http://fortune.com/2016/11/01/mcdonalds-court-settlement-franchise-workers-california/

Posted by Johanna Ortiz.

An ex-executive Andrew Caspersen at New York investment bank was declared guilty to securities and wire fraud. He admitted defrauding investors of more than $38 million, and the judge gave him four years in prison because the defendant’s attorney asked him for leniency for gambling addiction.

Caspersen was a good worker. He graduated from Princeton University and Harvard Law School. Unfortunately, for his addictions, he defrauded investors’ money including his family and friends. “I lost their money” he said “I abused their friendship. I destroyed my family’s name” (news.findlaw.com).

He used to go to an organization which helped him with his alcohol and gambling addictions; however, he never finished his treatment. He always quit. His attorney used this as an excuse to let the judge know that he is not under control and he is unable to think or act as a normal person. The judge declared him with a very real gambling disorder and for that reason he gave him short-term prison sentence. He said to the judge that he learned from this and he is going to retake the treatment.

His defense attorney said his client was very ill with his addictions that he did not care about money, and he just wanted to play. At the end of the day, he lost over $100 million. He had hope that no matter how many times he lost, he would win and take the money back.

In my opinion, Caspersen acted without values, morals, and respect to investors. He knew his addictions and he was irresponsible and quit the treatments. All his irresponsibility were not investors’ fault and he had to pay for his mistakes.

Johanna is an accounting major at the Feliciano School of Business, Montclair State University.

Posted by Gregory Scavelli.

Super storm Sandy had a devastating impact on the North-Eastern portion of the United States, areas like Long Island, New Jersey and Connecticut got trashed because of the regions un-preparedness in cases of the storm. To bring in a personal connection, the area that I am from on Long Island got it particularly bad, the Long Beach boardwalk that was a staple of the town since 1914 was completely broken down and destroyed and after that the town went into rebuilding mode. Now Long Beach is for the most part is better than the way it was before the storm. This was happening the other regions as well, the Jersey Shore was another area that got hit particularly badly. It’s been 4 years since the storm, but now that the re-building process is almost complete a lot of problems are steaming from it.

Since the storm New Jersey state prosecutors have filled criminal chargers to 161 cases for over 15 million dollars on account of fraud. More than one third of those cases have been fired this year. An example of an Ocean County motel pleaded guilty to falsely claiming that he had sheltered Sandy victims to get $81,000 in federal funds.

The problem facing many of these corporations is that many of them have no ethical business policies. For example raising the price of gas in the time of a crisis is very unethical because in most of these crisis situations people are low on money and making the pay extra for basic needs is unethical. Also, taking personal benefit in a crisis situation is also unethical, the example I earlier about the motel using falsified records to get reimbursed is just taking a situation in which people are suffering and using it for gain. Which is just a very un-ethical way of doing business.

Gregory is a sports management and marketing major with a minor in legal studies at the Stillman School of Business, Seton Hall University, Class of 2019.

Posted by Timothy O’Shea.

Tesla Motors, an automotive company in the Automotive Energy Storage industry, “who’s mission is to accelerate the world’s transition to sustainable energy.”(tesla.com) It “was founded in 2003 by a group of engineers in Silicon Valley who wanted to prove that electric cars could be better than gasoline-powered cars”(tesla.com). As of now, all Tesla Cars will be made with complete self-driving software. It is their belief that these self-driven vehicles will help to improve safety while also aiding in the transition to the world’s sustainability. However, Tesla’s autonomy options have had some challenges and have caused Tesla some trouble. Tesla has now faced a number of lawsuit’s regarding false advertising and marketing, more specifically false advertising and marketing of the car’s “Insane Mode”, a performance mode intended for fast acceleration, and also for the car’s autonomous mode.

After a few crashes, one of which was fatal, Tesla Motors has been receiving criticism for the way in which it chose to market and deploy its Autopilot driving-assist system. In the summer of 2016, Tesla was admittedly being investigated by the National Highway Traffic Safety Administration, for its first reported fatality in a self-driving vehicle, while a second potential crash, involving the Autopilot feature, arose. Multiple cases have erected in China after Tesla crashes, with one resulting in fatality, a 23 year old driver whose “dashboard camera showed the car hitting a cleaning truck from behind while traveling on a highway in central Hebei province.”(forbes.com) Another fatal crash took place in Florida, where Joshua Brown, 40 year old supporter of Tesla, was hit by a tractor trailer which was undetected by neither driver nor autopilot. A final crash that raise concern against Tesla’s Autopilot software occurred on the Pennsylvania Turnpike on July 1, where Albert Scaglione reportedly activated the self-driving feature prior to hitting the guard rail “off the right side of the roadway… crossed over the eastbound lanes and hit the concrete median.”

Amongst the many crashes and accusations, Tesla has continued to stand behind it’s autopilot saying that the crashes resulted from human error, rather than system error, and in most cases the opposing parties have not been able to prove otherwise. On a bold posting on its website, the company said “there is no car company in the world that cares more about safety than Tesla and our track record reflects that.”(usatoday.com) This statement resulted from the NHTSA’s disclosure it was further investigating the electric car company for the possibility of having their customers sign non-disclosure agreements that would impede reporting. With repeated complaints, the NHTSA continues to investigate the validity of Tesla motors vehicle safety but has not found any major problems at this time. From suspension concerns, to accusations of false advertising, to crashes and claims against the Autopilot feature, Tesla remains under consistent fire and has been on its toes ready to adapt and turn its feedback into more environmentally, economically, and logistically friendly features.

In more current news, Tesla has been running into some speed bumps in its growth and develop in Germany. The Federal Motor Transport Authority of Germany, has recently sent a request to Tesla asking them to stop advertising the “electric vehicles’ Autopilot function, claiming that this feature misleads drivers into unsafe inattention to the road.”(eetimes.com) Yhe claim released in late September, implies that Motor companies must refrain from using misleading terms like “auto-pilot”, “automated”, or “self-driving” if their cars do not possess the ability to control themselves completely independent of human involvement.” (eetimes.com) Tesla has responded saying its “Autopilot always requires that the driver remain engaged and ready to take over at any time.” (electrek.com)

Timothy O’Shea is an undecided business major at the Stillman School of Business, Seton Hall University, Class of 2019.

Sources:

Tesla issues thorough response following harsh critique of Autopilot by German authorities

http://www.eetimes.com/document.asp?doc_id=1330633

https://www.tesla.com/about

http://www.forbes.com/sites/dougyoung/2016/09/19/tesla-takes-new-china-hit-with-driver-death-lawsuit/#37346299284f

Posted by Magdalena Jasionowska.

Precision and honestly are fundamental when it comes to accounting. Any error can have some consequences, but it is important to remember that fraud is a serious crime. Here is a brief summary of the most recent tax fraud cases.

Christopher Haynes, a franchise owner of Liberty Tax Service has been preparing false income tax returns in order to increase clients refunds at three franchises. A federal court has permanently barred the franchisee for all three locations, and Christopher Paul Haynes of Irmo, South Carolina, from preparing federal tax returns for others. Christopher Haynes and his employees prepared returns that included misstatements such as false or increased Schedule C income and expenses, false filling statuses, number of dependents and inappropriate employee business expenses.  Haynes’s Liberty Tax Service offices have prepared more than 9,700 federal income tax returns since 2010 and and for that reason they have to provide the government the list of all their costumers whom he and his employees prepared a return from 2010 till todays day.

Nicole Coleman,34, the owner and operator of Comunnity Tax Assosociates was sentenced on Wednesday to 36 months in prison for obtaining more than $1.65 million in fraudulent tax refunds. “Coleman, filed federal income tax returns for herself and clients and knowingly made false entries to inflate refunds for clients. Coleman then took a portion of the refunds as a fee.” She, definitely harmed her clients, who trusted her to prepare and file their income tax returns.

An attorney William Doonan, 69, who operated a tax preparation in  Bronx, New Yoork, has pleaded guilty to charges related to his participation in filing fraudulent returns and falsely claiming more than $6 million in bogus deductions. Since 2009, Doonan regularly prepared and filled clients returns that were fraudulent. He’s been adding false medical expenses, state and local taxes, home mortgage interest deductions, charitable gifts and other expenses.

In conclusion, fraud, embezzlement, and misappropriation can occur in every type of business, even in accounting, the most trusted profession.

Magdalena is an accounting student at the Feliciano School of Business, Montclair State University.

Posted by Rafaela Andrade.

Costco wholesale store is now using new Visa credit cards and no longer American Express after fifteen years.  Under a new contract, Citigroup, Inc. will now be the issuer for their credit cards along with Visa, Inc. Early this year, Costco reported that their earnings were not met and the stock price had dropped. The reason why the wholesale store left and would not renew the contract with American Express is due to economic reasons. When the news of this broke to the public, the “credit- card company’s stock fell 6.4%.”

Costco only accepted American Express for the past fifteen years. The wholesale store represented around $80 billion of their business and just on interest it was about $14 billion. This was clearly a major hit for American Express. AmEx is also limited in certain retail stores. It is said that even though AmEx offers great rewards it is costly for the merchants, costing the retailer about 3.5% where Visa and MasterCard have a cost around 2-3% or less. Costco members will have rewards and allowing them to use their new Visa cards where they are accepted.

American Express provided deals to the members such as 3% cash back on gas, 2% cash back on restaurants and even when traveling, 1% on Costco purchases and other purchases. Visa offers 4% cash back on gas, 3% cash back on restaurant and eligible travel purchases, 2% cash back on purchases from Costco, and 1% on all other purchases. This deal is great way to get extra cash and there is no annual fee for the credit card. Many Customers are happy with the results while others are not as happy. Costco had to do what is best for the company (enter a new contract) in order to keep generating business.

Rafaela is an accounting major at the Feliciano School of Business, Montclair State University, Class of 2018.

Sources:

http://www.latimes.com/business/la-fi-costco-visa-20150302-story.html

http://www.marketwatch.com/story/5-things-to-know-about-the-costco-and-amex-breakup-2016-02-11

Posted by Aliyah Ponton.

A former executive, Andrew Caspersen, at a New York investment bank admitted swindling investors of more than $38 Million. As a result, he was sentenced to four years in prison. During court he told the U.S. District Judge, Jed Rakoff, “I chose gambling over everything.” The Judge cited his gambling as a reason for leniency. Andrew Caspersen is 40 years old and is a graduate of Princeton University and Harvard Law School. He also defrauded his job, PJT Partners Inc., of over $8 Million.

Caspersen is the son of the late Finn M.W. Caspersen, who was a philanthropist and former chief executive of Beneficial Corp. “I destroyed my family’s name,” said Caspersen. In the court room it was packed with family and friends as well as members of organization he has joined. Many of his friends and families argued for leniency to the judge. Rakoff imposed Caspersen’s prison term by giving him way less then the 15 years that was entitled for by the sentencing guidelines and also less than the 7 ½ years recommended by the Probation Department.

Caspersen stole from his friends, family, and from investors. He took advantage of his Wall Street pedigree and even stole from charities. “Using his Wall Street pedigree, Andrew Caspersen deceived and defrauded investors – including his own family and friends and a charity – out of tens of millions of dollars,” said the U.S. Attorney Preet Bharara. When faced by the judge Caspersen said that he was dedicated to continuing treatment for his gambling addiction but Assistant U.S. Attorney Christine Magdu said Caspersen failed to follow through with his gambling addiction treatment. She also added that Caspersen quit therapy after only seven sessions. In the end, after going to court and fighting for leniency, Caspersen was sentenced to 4 years in prison.

Aliyah is an accounting major at the Feliciano School of Business, Montclair State University, Class of 2019.

Source:

http://news.findlaw.com/apnews/feb61e4e2ac8475b9110b70ba45e9928

http://abcnews.go.com/US/wireStory/executive-ny-bank-years-prison-38m-fraud-43313982