1. Should the chair of the board of directors be allowed to initiate investigations into weaknesses in a company’s internal control system?
2. Is the strategy of pretexting an acceptable means in order to obtain critical information that will strengthen a company’s internal control system?
3. Should the reasons for resignations from a board of directors always be made public?
In January 2006, the chair of Hewlett-Packard (HP), Patricia Dunn, hired a team of independent electronic-security experts to determine the source of leaked confidential details regarding HP’s long-term strategy. In September 2006, the press revealed that the independent experts spied on HP board members and several journalists. They obtained phone call records of HP board members and nine journalists, including reporters for CNET, the New York Times, and the Wall Street Journal using an unethical and possibly illegal practice known as pretexting. Patricia Dunn claimed she did not know the methods the investigators used to determine the source of the leak but resigned after the scandal. Ten days earlier, George Key-worth, the director responsible for the leak, had resigned from HP’s board after 21 years of service.