Chapter 8 - THE BOARD
Morgan Systems’ board held an emergency meeting.
Ethan expected support.
He did not get much.
Board chair Samuel Price asked:
“Why was production-derived client data on a home device?”
Ethan said:
“Temporary staging.”
“Why?”
“To reproduce a model drift issue.”
“Why not in controlled infrastructure?”
“It was faster.”
Samuel stared.
“Faster?”
Ethan looked down.
That word sounded terrible now.
The company’s security policy required:
managed environments,
no local retention of customer-derived data beyond approved exceptions,
documented deletion.
Ethan had approved an exception informally.
No ticket.
No expiry date.
No review.
Because he was the founder.
That was another problem.
The board placed Ethan under temporary operational restrictions.
He remained CEO.
But:
security decisions moved to the chief security officer,
data-access approvals required dual signoff,
and all lender communications went through counsel.
Claire’s action had triggered the crisis.
Ethan’s shortcuts gave the crisis something dangerous to expose.
The board also reviewed whether Ethan’s $4 million potential secondary sale created a conflict.
If Ethan personally benefited from closing the Harbor Ridge financing, had he downplayed security problems to keep the deal moving?
There was no evidence he knew about the improperly retained staging file before the day Claire sent it.
But there were earlier security audit findings.
Two months before the incident, the chief security officer had recommended stronger controls on local developer exports.
Implementation had been scheduled for the next quarter.
Why wait?
Budget.
Engineering capacity.
Deal pressure.
Ethan had approved the delay.
That decision now looked worse.
Not fraudulent.
Not secret.
But aggressive.
The board asked whether founder liquidity influenced the timing.
Ethan denied it.
Minutes showed the upgrade delay had been recommended by several executives, not only him.
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That helped.
Still, the optics were poor.
