Federal Judge considers sanctions affecting Carnival that could affect cruises

[fragilek]

I am a little disheartened reading some comments on here - suggesting cashing in on this with share purchases🙄 and cruise worries (although I get how disappointing it would be if a cruise is canceled, been there! )- But  there is a much bigger picture here- This should have us cruisers voting with our feet- all cruises will do some damage to the planet- almost everyday life does damage - but our role should be to try and pair our enjoyment with minimizing this damage- These companies would soon clean up their act if passengers voted with there feet.  Then and only then will serious changes be made for the better, fudging audits will be irrelevant if passengers jump ship (literally).  

[cloudninecat]

3 minutes ago, fragilek said:

I am a little disheartened reading some comments on here - suggesting cashing in on this with share purchases🙄 and cruise worries (although I get how disappointing it would be if a cruise is canceled, been there! )- But  there is a much bigger picture here- This should have us cruisers voting with our feet- all cruises will do some damage to the planet- almost everyday life does damage - but our role should be to try and pair our enjoyment with minimizing this damage- These companies would soon clean up their act if passengers voted with there feet.  Then and only then will serious changes be made for the better, fudging audits will be irrelevant if passengers jump ship (literally).  

My concern is that they aren't the only line doing this, they are just the ones that got caught. I personally hope that whatever this judge decides to do that it not only hurts enough that Carnival gets the message that this won't be tolerated but that other lines that are doing the same thing will also get the message and clean up their act. I'm personally disheartened to hear that this is going on. You would think that they would have a personal stake in keeping the oceans clean as this is where they earn their livelihood. However, I've worked for enough big corporations to know that they all have one thing in common, short sightedness. 

[chengkp75]

Almost negligible chance that there will be a forced buyout.  There will be a huge fine, and a requirement that management lose their jobs and such, but that's about it, but the ban could be enforced if necessary.  The judge is not "on a power trip", but is likely applying the terms of the plea deal, which may include the use of "up to and including" barring ships from US waters.  If it is shown that the company knowingly continued illegal practices, and knowingly tried to subvert the third party audit system, this could be a company shaking level event for Carnival, with crippling fines and restrictions.  They could be required to have "Sea Stewards" (third party auditors with maritime experience) ride the ships full time to witness compliance on a day to day basis, much as Alaska did a few years ago (not sure if the practice is still in effect there).

[fragilek]

2 minutes ago, chengkp75 said:

Almost negligible chance that there will be a forced buyout.  There will be a huge fine, and a requirement that management lose their jobs and such, but that's about it, but the ban could be enforced if necessary.  The judge is not "on a power trip", but is likely applying the terms of the plea deal, which may include the use of "up to and including" barring ships from US waters.  If it is shown that the company knowingly continued illegal practices, and knowingly tried to subvert the third party audit system, this could be a company shaking level event for Carnival, with crippling fines and restrictions.  They could be required to have "Sea Stewards" (third party auditors with maritime experience) ride the ships full time to witness compliance on a day to day basis, much as Alaska did a few years ago (not sure if the practice is still in effect there).

Hopefully if they loose their jobs is isn't accompanied with a golden hand shake as so often seem to happen these days

[Bookbug53]

1 hour ago, fragilek said:

I am a little disheartened reading some comments on here - suggesting cashing in on this with share purchases🙄 and cruise worries (although I get how disappointing it would be if a cruise is canceled, been there! )- 

When do you think a lot of stock buyers buy their stocks? Not when the company is riding high and you can't afford them. I'm watching. 

And I currently have 2 cruises booked with them. 

[MicCanberra]

I would think that just like cruisers take advantage of cruise bargains, investors would do the same.

[Bob Bob]

On 4/11/2019 at 6:18 AM, twentyknots said:

The Judge will hear the case again in June.  Does anyone know the date in June?  We have cruise on HAL's Oosterdam departing Seattle on June 2, 2019.

I have one on 6/1/19 out of Miami

 

Hope the case is being heard later in June

[Laurab23]

We leave NYC on Sunrise May 27 and come back in June so I am watching closely to see how this all unfolds. I don't want to be flown back to NYC because I hate to fly and never do. I hope they get it all straightened out.

 

Laura

[ProgRockCruiser]

12 hours ago, Organized Chaos said:

I don't think it was simply about preparing for one of the audits. I think they were actively covering up the violations they knew they didn't fix. One email stated, “It would be really important to go onboard on August 12 for one week in order to have time to manage issues before the audits and avoid findings."  And another mentioned “prevent audit findings." It really sounds like they knew there were violations, which means they were knowingly failing to comply with court orders.

 

But that is exactly how all companies prepare for audits, including financial (e.g. SOX) and process-related audits (e.g. CMMI or ISO-9001):  Go through the system, looking for problems, manage those issues maybe by correcting some process, and get your house in order.  That way, when the auditors come, you can feel confident you are in good shape and will, indeed, avoid findings.  

 

If you don't poke your organization to review current procedures right before a known audit/inspection, you are taking a huge chance something has lapsed recently and will be a black mark on your record - that would be foolish.  Find it now before they do, fix it, and if possible find a way to make sure it doesn't happen again.  Some companies that I have worked for do internal audits all the time to make sure stuff is in compliance, so that when the auditors announce they are coming it isn't a huge panic to make sure nothing has slipped.  Other companies tend to take the "panic at last minute" approach.

 

What would be wrong would be to "fix the problems" by hiding the data, destroying the data, or falsifying records to create fake data.

 

If Carnival did any of that: Shame!  Shame!  Shame!  (Oblig GoT ref)

Edited April 12, 2019 by ProgRockCruiser

[elcuchio24]

I mean look, great conversation here. I would bet you all my future cruises that there will be ZERO interruption in cruise departures, and no effect on the average cruiser. The cruise industry's effect on the economies it serves are huge and that is not going to be jeopardized over this issue. 

 

I follow things on the financial side mainly, and almost every analyst is expecting some fines and demands for some executive changes. That'll be it. 

[jbethel11]

Just now, elcuchio24 said:

I mean look, great conversation here. I would bet you all my future cruises that there will be ZERO interruption in cruise departures, and no effect on the average cruiser. The cruise industry's effect on the economies it serves are huge and that is not going to be jeopardized over this issue. 

 

I follow things on the financial side mainly, and almost every analyst is expecting some fines and demands for some executive changes. That'll be it. 

Oh, no there will be an effect. Carnival will pay some fine but then jack up our prices as someone had previously mentioned. 

[elcuchio24]

36 minutes ago, jbethel11 said:

Oh, no there will be an effect. Carnival will pay some fine but then jack up our prices as someone had previously mentioned. 

 

They already jack up the prices as far as their research shows will support filling their ships. That's business. More likely it will come out of the bottom line, and the pockets of the stockholders.

[Organized Chaos]

55 minutes ago, ProgRockCruiser said:

 

But that is exactly how all companies prepare for audits, including financial (e.g. SOX) and process-related audits (e.g. CMMI or ISO-9001):  Go through the system, looking for problems, manage those issues maybe by correcting some process, and get your house in order.  That way, when the auditors come, you can feel confident you are in good shape and will, indeed, avoid findings.  

 

If you don't poke your organization to review current procedures right before a known audit/inspection, you are taking a huge chance something has lapsed recently and will be a black mark on your record - that would be foolish.  Find it now before they do, fix it, and if possible find a way to make sure it doesn't happen again.  Some companies that I have worked for do internal audits all the time to make sure stuff is in compliance, so that when the auditors announce they are coming it isn't a huge panic to make sure nothing has slipped.  Other companies tend to take the "panic at last minute" approach.

 

What would be wrong would be to "fix the problems" by hiding the data, destroying the data, or falsifying records to create fake data.

 

If Carnival did any of that: Shame!  Shame!  Shame!  (Oblig GoT ref)

 

Which they've done. The auditors found that they've repeatedly been falsifying records, to include an instance of an engineer falsifying maintenance records about the cleaning & testing of equipment.

 

This isn't the same as an average company preparing for a routine audit. These are court-ordered audits/inspections because the company, including its subsidiaries, have been caught breaking serious laws and violating important maritime regulations, some over a period of several years. They were ordered to get their act together, but they didn't. Instead, they thumb their noses as the outcome and don't fix the problems UNTIL they know the auditor is coming. Then they send out the word to hurry up and fix them, or at least put a band-aid on them, just to keep from getting busted again. If you ask me, that's willfully failing to abide by a court's orders.

 

Imagine someone on probation after being convicted of drug use. The court orders their probation officer to inspect their residence regularly. They're still using drugs, which is obviously illegal and a violation of their probation. The person knows their probation officer is coming on Tuesday, so they get rid of, or hide, all of the drugs until it's done. They aren't simply preparing for an inspection. They're still breaking the law, but trying to hide it.

[Micahs Grandad]

27 minutes ago, elcuchio24 said:

 

They already jack up the prices as far as their research shows will support filling their ships. That's business. More likely it will come out of the bottom line, and the pockets of the stockholders.

Agreed, prices are adjusted to maximize profit. The market will not support increases just to pay their fines.

[Micahs Grandad]

3 minutes ago, Organized Chaos said:

 

Which they've done. The auditors found that they've repeatedly been falsifying records, to include an instance of an engineer falsifying maintenance records about the cleaning & testing of equipment.

 

This isn't the same as an average company preparing for a routine audit. These are court-ordered audits/inspections because the company, including its subsidiaries, have been caught breaking serious laws and violating important maritime regulations, some over a period of several years. They were ordered to get their act together, but they didn't. Instead, they thumb their noses as the outcome and don't fix the problems UNTIL they know the auditor is coming. Then they send out the word to hurry up and fix them, or at least put a band-aid on them, just to keep from getting busted again. If you ask me, that's willfully failing to abide by a court's orders.

 

Imagine someone on probation after being convicted of drug use. The court orders their probation officer to inspect their residence regularly. They're still using drugs, which is obviously illegal and a violation of their probation. The person knows their probation officer is coming on Tuesday, so they get rid of, or hide, all of the drugs until it's done. They aren't simply preparing for an inspection. They're still breaking the law, but trying to hide it.

Agreed this is what makes their actions so reprehensible. Even worse they tell us they are eliminating straws to help the environment. Can anyone say hypocritical?

[lottiegreen56]

I’m sure the judge will cut them some slack for cutting down on plastic by doing away with the pens...Brilliant!!!

[eir99]

So I just put a Carnival cruise on hold yesterday for my daughter's graduation present. And now I am scrambling to find another cruise line.  Worried that a cruise going out in late June may not happen.  I think Carnival should be accountable for invalidating their probation. I just don't want to get caught without a trip for a group of graduating seniors.  Should I be concerned?  Its going to cost me an extra $500-1000 to get on another cruise line.  Might be worth it for the peace of mind.  

[keywest1]

Raising prices would likely backfire on them.  We have two Carnival cruises booked after cruising other lines for a couple of years.  We had no complaints with Carnival.  I was just able to find better deals on the other lines and it seemed to be a good time to branch out a little.  With our two future cruises, Carnival was the best deal by a pretty good margin.  Now, Carnival is our second favorite line, but the differences between the three are small enough that we will sail for itinerary, ship, and mainly price.

With the current news, it will take a substantial price difference and/or unique itinerary to cause us to choose Carnival again, even considering the fact that another cruise would take us to Platinum.  

[keywest1]

5 minutes ago, eir99 said:

So I just put a Carnival cruise on hold yesterday for my daughter's graduation present. And now I am scrambling to find another cruise line.  Worried that a cruise going out in late June may not happen.  I think Carnival should be accountable for invalidating their probation. I just don't want to get caught without a trip for a group of graduating seniors.  Should I be concerned?  Its going to cost me an extra $500-1000 to get on another cruise line.  Might be worth it for the peace of mind.  

If I were in your shoes, I think I would book another cruise line.  I really don't think the cruises will be cancelled, but it would not be worth taking a chance with such a special occasion.  

Since the news has already broken, I'm wondering if cruise insurance purchased now would cover costs if cruises are cancelled due to court sanctions?  I'd want to know the answer to that question before I bought the policy.

Just my opinion, but graduations are stressful enough without the added worry of having a last minute cancellation.  Peace of mind is indeed a valuable thing 🙂

[broberts]

While I agree that the individuals responsible for the decisions and actions leading to violations should be punished, it isn't sufficient. With a repeat corporate offender, so long as the shareholders are not punished there is little incentive for them to force a change in corporate behavior. 

 

The argument that the judge should not consider actions that can harm innocents is specious. It is not the judge's actions that will harm innocents, it is those of the perpetrator of the violations being punished. Stolen property is routinely seized from innocent purchasers and returned to rightful owners, without compensation. Innocent children are routinely separated from parents sent to jail. Why should those working for or purchasing from a company that is judged to be in violation of the law have any special protections from the outcomes of judicial actions against an offending company? 

 

 

[Tiggerontheseas]

54 minutes ago, eir99 said:

So I just put a Carnival cruise on hold yesterday for my daughter's graduation present. And now I am scrambling to find another cruise line.  Worried that a cruise going out in late June may not happen.  I think Carnival should be accountable for invalidating their probation. I just don't want to get caught without a trip for a group of graduating seniors.  Should I be concerned?  Its going to cost me an extra $500-1000 to get on another cruise line.  Might be worth it for the peace of mind.  

 

I'm not sure it wouldn't be a bad idea to cancel your cruise (although I have my doubts that they will actually ban ships from docking in U.S. ports) as a 'just in case' peace of mind act.  I've just had a cruise that we've been planning for almost 2 YEARS yanked out from under us 3 weeks before sail date and it is devastating!

 

However, please make sure that you don't book with another of Carnival Corporation's lines (Princess, Holland America, P&O, etc.) as if the ban does happen those ships will also be banned.

[gtouch]

20 minutes ago, broberts said:

While I agree that the individuals responsible for the decisions and actions leading to violations should be punished, it isn't sufficient. With a repeat corporate offender, so long as the shareholders are not punished there is little incentive for them to force a change in corporate behavior. 

 

The argument that the judge should not consider actions that can harm innocents is specious. It is not the judge's actions that will harm innocents, it is those of the perpetrator of the violations being punished. Stolen property is routinely seized from innocent purchasers and returned to rightful owners, without compensation. Innocent children are routinely separated from parents sent to jail. Why should those working for or purchasing from a company that is judged to be in violation of the law have any special protections from the outcomes of judicial actions against an offending company? 

 

 

It also will have an economic impact on the tourist industries and their employees in those ports. The ports and cities themselves on loss fees and revenues.

[above sea level cruiser]

8 hours ago, chengkp75 said:

They could be required to have "Sea Stewards" (third party auditors with maritime experience) ride the ships full time to witness compliance on a day to day basis, much as Alaska did a few years ago (not sure if the practice is still in effect there).

Last spring on our Celebrity Infinity cruise to Alaska, there was in fact a Sea Steward on board that we met. His job was to witness any and all things related to ensuring compliance. He said he would be on the ship for a week or so then on to the next ship and eventually rotate through all of them in the region. 

[Sam Ting]

26 minutes ago, gtouch said:

It also will have an economic impact on the tourist industries and their employees in those ports. The ports and cities themselves on loss fees and revenues.

 

People are probably going to go on vacation anyway so other areas might actually gain tourism dollars, add jobs etc.  

 

I know we spend very little in the port city on embarkation day or when we get off the ship.  

[CdrescherRBL152]

The ban will never happen and here is way. Just the port of Miami gets roughly $100,000,000 per year from Carnival. That is just Fock fee. Does not include such things additional security, long shormen, money from Hotels and airfare. Add it all up the ban round come close to  a billion dollar a year hit to local economies. Nope the ban will never come to be.