Bank of America: Banking on a Reputation Crisis?

Source: Forbes
Date: Jan 3, 2011
By: Andy Beal
Link: Online Story

Bank of America: Banking on a Reputation Crisis?

According to Oxford Metrica, during the next five years, 83 percent of companies will face a crisis that will negatively impact its share price by 20 to 30 percent.

For Bank of America, that could happen in the next five weeks! And, based on a report by The New York Times, the Charlotte, NC based bank is acting as if it could happen in the next five days!


Back on November 29th, Wikileaks’ Julian Assange threatened to “take down” a major American bank and, with rumors swirling that Wikileaks holds a 5GB hard drive once owned by a BoA executive, it doesn’t take a rocket scientist to figure out that Bank of America is the likely target.
According to the NYT:

Bank of America shares fell 3 percent in trading the day after Mr. Assange made his threat against a nameless bank, and while the stock has since recovered, the prospect of a Bank of America data dump from WikiLeaks remains a concern, said Moshe Orenbuch, an analyst with Credit Suisse.

So very bad news for Bank of America, right? Absolutely, but there is a silver lining. You see, I caution all companies to take a look at their potential risk for a reputation attack–what’s their achilles heel? Most simply ignore the risks, or are unwilling to admit that they have any weaknesses that could be attacked.

Fortunately for BoA, the bank has advanced warning from Assange. Rarely does a company get advanced notice that it’s about to come under a viscous, calculated reputation attack. BoA is not looking this “gift horse” in the mouth–it’s taking action!

Since then, a team of 15 to 20 top Bank of America officials, led by the chief risk officer, Bruce R. Thompson, has been overseeing a broad internal investigation — scouring thousands of documents in the event that they become public, reviewing every case where a computer has gone missing and hunting for any sign that its systems might have been compromised.

Whether the bank is the next target of Wikileaks, no one knows for sure. Still, BoA is not taking any chances.

If something happens, we want to be ready,” one bank official said. “You want to know what your options are before it comes out, rather than have to decide on the spot.

Does your company have a Wikileaks contingency plan? Of course, very few of us will ever find ourselves facing a reputation attack from Wikileaks, but that doesn’t mean you won’t one day face a similar crisis from some other front. In fact, 83% of you are less than five years away from a reputation nightmare.

Are you prepared?