CCRcorp Sites  

The CCRcorp Network unlocks access to a world of insights, research, guides and information in a range of specialty areas.

Our Sites


A basis for research and practical guidance focusing on federal securities laws, compliance & corporate governance.


An educational service that provides practical guidance on legal issues involving public and private mergers & acquisitions, joint ventures, private equity – and much more.


The “one stop” resource for information about responsible executive compensation practices & disclosure.

Widely recognized as the premier online research platform providing practical guidance on issues involving Section 16 of the Securities Exchange Act of 1934 and all of its related rules.


Keeping you in-the-know on environmental, social and governance developments

Yesterday, The Wall Street Journal and Bloomberg’s Matt Levine reported on a problem with Amazon’s safety record and $90 million obtained from lenders. The WSJ laid out the situation, which started last summer:

“The U.S. Attorney’s Office in Manhattan issued a subpoena in August to Amazon for information the company might have shared with financial institutions involved in at least $90 million in contracts or agreements with the online retailer in the previous five years, specifically information it shared on its injury rates and labor law compliance.”

The article explains things a bit more:

“The Manhattan U.S. Attorney’s Office is conducting an investigation into Amazon under the Financial Institutions Reform, Recovery and Enforcement Act [Firrea], a law that allows civil cases to be brought over wrongdoing that impacts banks. The office has deployed the 1989 law at the same time the Labor Department presses a workplace safety investigation of Amazon that has already led to several citations. 

The Labor Department in December cited Amazon at six of its warehouses for not adequately reporting injuries and this week cited three company facilities, saying workers were exposed to ergonomic or equipment hazards.

Amazon has said it intends to appeal the citations. The company also said it never intentionally misrepresented its safety record.”

The ever-so-eloquent Levine added his thoughts:

“In its credit agreement, Amazon says that it complies with the law, so if it did not comply with labor law then its credit agreement was not strictly true. And perhaps in the due diligence for a loan, a bank sent over a questionnaire asking things like ‘are your workplaces safe,’ and probably Amazon answered ‘yes’ in some sort of qualified and lawyered way, and if the answer should have been ‘no’ then, right, fraud. Of course no one at a bank made a credit decision based on that questionnaire. It’s not like Jamie Dimon was called in to decide whether JPMorgan Chase & Co. should lend to Amazon, and he said ‘hmm, I don’t know, how’s their safety record,’ and the analyst who sent the due diligence questionnaire was like ‘well they say here that it’s good,’ and Dimon said ‘well okay, if you think we can trust them about that, then let’s lend them the money,’ and JPMorgan went ahead on that basis and was shocked to find out that Amazon’s safety record was not so good. Presumably what happened is that some credit committee made the credit decision by asking ‘wait this is Amazon?’ and the relationship banker was like ‘yep’ and the credit committee was like ‘sure wave it in’ and nobody discussed worker safety at all. And if they did, it was probably along the lines of ‘well, Amazon is a huge company and a great credit, shame about its spotty worker safety record but we gotta make this loan.’”

This matter took me by surprise, but it seems to make sense at a technical level. Levine agrees:

“It is very easy to understand how a safety inquiry could plausibly be shoehorned into a Firrea investigation! [Zainab Ahmad, a partner at outside counsel Gibson, Dunn & Crutcher LLP] doesn’t like it, and really neither do I, but I understand it.”

Given the immense pressure and scrutiny companies face concerning ESG, workplace conditions and expanded disclosures, I wouldn’t be surprised if this is only the beginning of a wave of similar investigations/lawsuits. Companies with high-profile safety incidents (including fatalities), a series of unfortunate events that captured the attention of media, NGOs or regulators, or those taking combative positions against health and safety regulators may be at the top of the list for further Firrea investigations.

Companies may need to look at this both in terms of previous representations made to lenders about corporate safety/labor compliance and how to avoid this risk going forward. A good way to start both/either is an independent assessment of internal safety incident reporting, injury rate calculations, validation, controls and information flow/management systems. It is also a very good idea to ensure that anyone who fills out forms that go to banks/lenders (or anyone, really) doesn’t simply make assumptions or “tick the box” on safety, environmental or other ESG questions. Those folks need to know who to seek out internally and get the correct answer.

Safety professionals and auditors – you might get very busy very soon.

Back to all blogs

The Editor

Lawrence Heim has been practicing in the field of ESG management for almost 40 years. He began his career as a legal assistant in the Environmental Practice of Vinson & Elkins working for a partner who is nationally recognized and an adjunct professor of environmental law at the University of Texas Law School. He moved into technical environmental consulting with ENSR Consulting & Engineering at the height of environmental regulatory development, working across a range of disciplines. He was one… View Profile