SolarWinds’ shares drop 22 per cent. But what’s this? $286M in stock sales
theregister.com
theregister.com
Why is that even proposed as the end of the plausible explanation? Seems equally plausible that the CEO stepped down as a condition of not being blamed for gross incompetence (ie help whitewashing this taint on his record) while staying silent so that everyone (including him) gets a nice payday and can move on to some other area?
There’s lots of possible explanations. Why not urge a full public accounting so that everyone can review if any wrongdoing took place?
This is what bugs me the most about the corporate landscape.
You can be incompetent & cause huge damage to a business, but if your a c-level, your usually given the option of leaving quietly, with a nice payout and then continuing your career like nothing ever happened.
Just wait 6-12 months and you'll see this CEO pop up at another company, and on their website in his bio it will read something like "Implemented and executed a revolutionary vertical & dynamic cyber and security strategy at SolarWinds saving the business $xxx"
It's not just n the Corporate World, either: the failing up method of success is prevalent in government, too. Which often has a revolving door into certain Industries for some reason...
I think this has more to do with widespread corruption within certain set class of people in Society than it does as a single isolated issue of incompetent individuals. The goals shouldn't be to get those standards to apply to a c-level and below employee, it should be to phase away with those incentives completely.
Elon mentioned the over MBA-ization ruining US business culture and innovation, which is no doubt a factor; but to be honest the lack of accountability and that actual punitive punishments for their mistakes seem to often be non-existent are for me way more systemic and a greater drag on overall progress, since the wrong incentives (like this) are already baked in to the process of a 'successful career' by default.
It’s important to define what qualifies as success.
Successfully maximising capital extraction and gains for the subset that are relevant to your career may be more important than successfully executing business / government strategy for shareholders / the public.
And this is the very crux of the issue, and what is being portayed as a 'successful career' is nothing more insulting embellishment based on than vulture/cronyist practices operating under the false veil of capitalism: short sighted thinking coupled with an perverse culture that enables this leads to this wide spread corruption, be it in banking/corp World or in Government. One doesn't have to look very far to see the parallels to this pandemic and that of 2008 to see nothing really changed, and its made it clear that the US may be the current hegemon but it's standing in the World has significantly diminished in my Lifetime.
Naomi Klein's shock doctrine outlines this very well, and unless this very thing is addressed we're seriously screwed as a Species. We don't need more Elizabeth Homes, Bernie Madoffs, Blyth Masters, Lloyd Blankfiens or Jamie Dimons and we should discourage any more from being created, because upon even the slightest amount of scrutiny you realize they're incredibly stupid and are failures at doing anything but screwing up and putting themselves in a position getting a massive pay out from it--almost always State subsidized.
Instead we ask more and pay less of those very people who keep the system from completely toppling over while wealth get even more and more concentrated. It should be very clear that a country that funnels this much into the investment class while 1/4 of the country is unemployed and ask its medical workers to function without PPE is a reflection of these misdeeds. And that the illusion cannot be maintained anymore.
Rather it’s usually management setting things up for failure, not listening to employees, not giving support or required resources. And the line employee will get scapegoated while the bad management a few levels above will fail up and deflect any blame.
That's pretty much on every dev's resume as well, despite their buggy project getting hated by everyone and shut down.
For big policies, sure - blame the CEO. But for things like a security vulnerability? No.
In a company that sells these types of products to these types of customers, security is paramount.
His departure was announced in August.
In my opinion, they likely started looking at their security practices at that time.
https://www.theregister.com/2020/12/16/solarwinds_github_pas...
[0] https://blog.cloudflare.com/solarwinds-orion-compromise-tren...
Do you think your company could withstand an attack from a nation state with unlimited powers? Doubtful.
Even if the investors did know about the security breach, it wouldn't be illegal for them to trade on that information so long as it wasn't 'insider' aka they were made aware by the company itself.
We don't know what happened, but the issue is not with trading shenanigans, the issue is the materiality of the security breach and who did it, how and why etc..
>The software house announced in August that Kevin Thompson would leave the company though it didn’t give a date. Thompson reportedly quit on Monday, December 7 – news that was not made public – and a new CEO was formally announced two days later, on December 9, the day after FireEye went public on December 8 with details of the intrusion into its own systems.
Why would a VC wait until the CEO resigns to dump their stock, if they already knew that he was leaving? Wouldn't it make more sense to slowly dump it over several weeks/months so you don't move the market? The "plausible explanation" sounds like a convenient excuse, imo.
https://www.washingtonpost.com/news/wonk/wp/2013/09/24/trade...
(And "simultaneously" is right out.)
Good luck telling regulators this, I suppose...
1) Is $286m a lot?
2) How many insiders are there and what is normal behavior for them?
3) Are these well-timed sales abnormal or are we only looking because of the headlines?
A quick read of this story doesn't seem to answer these questions.
SWI has 53 million floating shares, resulting in 53m*23= $1.2 billion today.
So a quarter of float traded. That is crazy movement.
Sounds like a good time to pick up some SolarWinds stocks.
Congress should probably just listen to Dan Geer and establish products liability for closed-source software. I feel like this might have turned up sooner if there was a git diff to read.
[1] https://blog.erratasec.com/2011/03/comodo-hacker-releases-hi...
[2] https://www.comodo.com/news/comodo-ceo-entrepreneur-of-the-y...
> On Saturday, December 12, our CEO was advised by an executive at FireEye of a security vulnerability in our Orion Software Platform which was the result of avery sophisticated cyberattack on SolarWinds.
That timeline also matches FireEye's statements and disclosures.
Since negotiating these sales takes time, it's likely that weeks elapsed between the negotiations and SolarWinds learning of this on Dec. 12.
[1]: https://d18rn0p25nwr6d.cloudfront.net/CIK-0001739942/6dd04fe...
https://web.archive.org/web/*/https://www.solarwinds.com/com...
https://webcache.googleusercontent.com/search?q=cache:2CZ1Lu...
And there's a pastebin of it:
https://pastebin.pl/view/d91b2b30
---
The Verge article on removing the customer list:
https://www.theverge.com/2020/12/15/22176053/solarwinds-hack...
TLDR: if you email them and prove ownership of the domain, they will remove the archived content.
Edit: I am finding the page on archive.org after all:
https://web.archive.org/web/20201213230906/https://www.solar...
I don't think many people if any got paid. Perhaps some lawyers.
I’m not sure they even paid out the prorated amount.
https://bits.blogs.nytimes.com/2009/05/20/solarwinds-beats-o...