The case highlighted a major issue facing the U.S. industrial and financial regulators: the porous control mechanisms for multinational corporations such as United Technologies that have many subsidiaries outside of the United States, complicating efforts to enforce federal regulations.
In this case, the most damaging violation of export controls took place through United Technologies subsidiary Pratt & Whitney Canada.
New York-based financial services firm JPMorgan Chase & Co. recently lost billions of dollars despite the watchful eyes of financial and market regulators. JPMorgan had been highly regarded as an example of corporate responsibility.
After the debilitating loss, a congressional hearing disclosed that Securities and Exchange Commission officials and other market regulators did not have any meaningful jurisdiction over JPMorgan’s international operations. The huge financial loss took place at its London branch, far from the watchful eyes of Washington and New York.
• Miles Yu’s column appears Thursdays. He can be reached at firstname.lastname@example.org.