Enron, WorldCom, Tyco, Martha Stewart and Global Crossing have had their problems
in the last few years with suspicious accounting, questionable stock manipulation and layers
of obfuscation. But when you compare the dollar amounts involved, nobody has cooked up a
scandal as big as Social Security, Fannie Mae, Freddie Mac or Amtrak.
There is another nearby page for the discussion
of The Great Wall Street Bailout of 2008.
The latest–
Radical environmentalists part of economic
meltdown. Enron has become synonymous with corporate corruption and a major part of that was
with the shell game that are carbon credits. They and British Petroleum (BP) exploited the environmental
issue of alternative energy and carbon credits before global warming was even a full-blown myth in the public
domain. Before the company collapsed under the weight of financial scandal, Enron under CEO Ken Lay
was a key proponent of the cap-and-trade idea.
Did someone
mention Cap-and-trade?
Enron's Skilling asks for prison release.
In an aggressive 160-page filing, ex-Enron CEO Jeff Skilling asked a federal appellate court today to get him
out of prison, where he's been for more than a year, and get him a new trial in a new town.
Judge vacates Ken Lay's Enron
conviction. Former Enron Chairman Ken Lay's criminal conviction was vacated and his indictment
dismissed by a judge today. U.S. District Judge Sim Lake granted the request by Lay's estate to vacate
the conviction, an outcome that was widely anticipated given legal precedent. He also dismissed the
indictment used to bring him to trial earlier this year.
Judge
gives Enron CFO 6 years. Andrew Fastow, whose financial wizardry was exposed as fakery and theft
in the Enron Corp. collapse, was sentenced to six years in prison Tuesday — four years less than
provided in his 2004 plea agreement.
An
Open Letter to Linda Lay, Kenneth Lay's Widow: I just wanted to tell you how sorry I am. I'm
sorry for a culture that seemed to enjoy turning your husband into a demon, even in death. I believe
that type of demonizing is fueled by a media that loves to watch wealthy, powerful people squirm.
The Thompson Memorandum and Federal
Prosecution of White-Collar Crime. In a criminal prosecution that America's legal and business
communities have been watching closely, a federal court in Manhattan issued two rulings this summer that shed
light on questionable and apparently unconstitutional tactics that the U.S. Department of Justice has been
using in its post-Enron, post-WorldCom offensive against "white-collar" financial crime.
Corporate
pandering to the left. A report issued recently by the Capital Research Center in Washington
punctures illusions that tend to associate big corporations with right-wing or conservative causes. The
report depicts a reality that is exactly the opposite. CRC researchers examined contributions made in
2004 by the foundations of the nation's top 100 corporations to nonprofit organizations. The result:
corporate contributions to left-leaning groups totaled $59 million and to right-leaning organizations
$4 million. That's about 14.5 corporate dollars going to the left for each dollar going to the right.
Statement on the Enron Verdict and
Sarbanes-Oxley. Members of the Enron jury should be commended for their
deliberative process. They carefully weighed the evidence involving complex accounting
issues and concluded that Ken Lay and Jeff Skilling were indeed guilty of fraud. It is
testament to the jurors' careful scrutiny of the facts that they did not find Skilling guilty
on the "insider trading" charges.
Enron Convictions
Tar Bush, Says Newsweek's Howard Fineman. What makes the Fineman piece noteworthy — almost
hilarious — is Fineman's admittedly admirable attempt to be fair by including caveats to his thesis
that Enron belongs on "the debit side of the Bush-era ledger." Fineman's caveats outnumber
his proofs by 2-1, resulting in a piece that proves the opposite of what Fineman contends.
American
inmate: Enron's Ken Lay and Jeff Skilling are about to trade their corporate suites for prison
cells. Sometimes the system works. As prosecutors argued and jurors apparently agreed, Enron
collapsed not because of bad press or market forces beyond executives' control, but because of criminal
choices and "outright lies."
A $40 billion scandal:
As reporter Lester Holt of NBC's "Today" put it in a Jan. 1 story, "Enron has been the poster child, if
you will, of corporate scandals." It isn't the only one, though. There's $40 billion scandal with
most of the same elements — even connection to prominent politicians. Just don't expect to see
much about it on TV. After all, the top people involved here are Democrats.
How to Avoid More Enrons: Legalize
Fraud. White collar "crimes" like fraud or embezzlement are different from ordinary crimes like
murder or theft. The victims of white collar crime are not innocent bystanders; they are shareholders
who willingly purchased a company's stock. That is, shareholders entered into "contracts" with the
corporation. … Under the contracting approach, this would be a civil matter between shareholders
and the corporation rather than a matter of criminal law.
TIAA Breaches Whistleblower. US
Supreme Court lowers Whistleblower protection for employees reporting fraud or criminal misconduct to the
proper authorities, but employees have more protection if they go straight to the news media. … What
makes this worse is the news that the Feds apparently support the coverup, when the whistleblowers
appeal the employer [applies] punitive action. Had computer staff lied to investigators, claiming
no problem, like management had wanted, they would still have their jobs. Thus computer workers have to
balance behavior that will help career integrity vs. what is in the best interests of protecting customers
and investors.
[It took a few minutes of research to learn what TIAA is. TIAA-CREF = Teachers Insurance and Annuity
Association - College Retirement Equities Fund.]
[The material from here down was added before the May 25 Enron verdict, but it's not just about Enron.
Other companies have (had) similar problems.]
By the Book: Lessons from the Enron
Scandal. Even though the trial of former Enron executives Kenneth Lay and Jeff Skilling is still
underway and their criminal charges alleged, it appears that the public has already formed an opinion on the
moral character of these and other players of the Enron scandal.
Making a
business a crime: Those who believe that unethical behavior in business stems solely from the
desire to increase profits and raise the bottom line, may be surprised to learn that corporate behavior
most of us would consider to be unethical is often mandated by law.
Press sapped Enron, Lay
asserts. Enron Corp. founder Kenneth L. Lay blamed the press yesterday [4/25/2006] for
undercutting his company's strengths in the weeks before it crashed by highlighting problems that
he said were already resolved.
Enron
whistle-blower Watkins says she warned Lay. Enron Corp. whistle-blower Sherron Watkins
recounted on Wednesday [3/15/2005] how she warned then-chief executive Ken Lay in August 2001 that
financial fraud could destroy the company, but that his response was to launch a "bogus" investigation
and try to have her fired.
Enron movie misses Hillary's role in
scandal. To its credit, Alex Gibney's good-looking new film, "Enron: The Smartest Guys in the
Room," is more honest than "Fahrenheit 9/11." At least the film deals with a real
scandal. … And yet despite the fact that almost all of these transactions took place during the
Clinton years and with the administration's active support, the word "Clinton" is not
once mentioned in the film.
Ex-WorldCom CFO Gets
Five Years in Prison. Former WorldCom finance chief Scott Sullivan was sentenced
Thursday [8/11/2005] to five years in prison by a judge who called him "the architect" of the
company's epic fraud — but gave him a break because he helped convict his
onetime boss, CEO Bernard Ebbers.
Ex-Chief
and Aide Guilty of Looting Millions at Tyco. L. Dennis Kozlowski, the
former chief executive of Tyco International, and his top lieutenant were convicted
yesterday on fraud, conspiracy and grand larceny charges, bringing an end to a
three-year-long case that came to symbolize an era of corporate greed and scandal.
Stop
this corporate scandal now. Is the administration tolerating an increased risk
of terrorism because it doesn't want to stop big businesses from hiring illegal aliens?
Fannie
Mae's bailout tab: Fannie Mae, the government-sponsored mortgage
association, has been battling a mounting scandal since last year. It has
accounting errors of about $11 billion. [That's Enron × 19.] This
is news — $30 billion worth of news — but only
print reporters are out there covering it regularly. TV news is out to lunch.
Party
of the People? Anyone who has followed the accounting scandals closely knows
when the bulk of the crooked accounting started: the second half of the 1990s, under Clinton,
whose administration looked the other way when the bogus bookkeeping of Cendant and Sunbeam
came to light. Investors know that the stock market collapse started in the spring of
2000, nearly a year before President George W. Bush was sworn in.
Oil for
corruption: The cover-up is always worse than the crime, they say. But
that doesn't necessarily hold true when you're dealing with the crime of the
century — in fact, two centuries. And the U.N. Oil-for-Food program
is among the largest criminal enterprises in history.
Fannie Mae is Corporate
Turkey of the Year. Citizens Against Government Waste today [11/24/2004] named
Fannie Mae its 2004 Corporate Turkey of the Year in recognition of how it has cooked the
books in its growing accounting and corporate governance scandal. Fannie Mae is a
government-sponsored enterprise, mashed together by Congress and endowed with tens of
billions of dollars worth of special privileges and exemptions. Fannie Mae has
been under scrutiny over the last several years because its securities enjoy the implied
backing of the taxpayer, yet Fannie Mae (like its corporate cousin Freddie Mac) is exempt
from many of the regulatory and accountability rules other major financial companies
must comply with.
Did
Ron Brown die for Enron's sins? An explosive new expose on the
man "who knew too much".
Corporate Scandal
Flowchart: apocryphal but interesting.
Enron,
WorldCom, and Other Disasters: Enron is a symbol of a broader problem.
Freddie
Mac Overstated Earnings by $1 Billion. Mortgage-market giant Freddie Mac
has disclosed that it had inflated its earnings for 2001 in financial reports by
$1 billion, the first time in its months-long accounting crisis that it
acknowledged overstating profits.
The
mother of all financial scandals: Fannie Mae and Freddie Mac … are
faceless, government-sponsored enterprises in a complex, loosely regulated,
highly leveraged monopoly business that has engaged in questionable accounting
practices and put billions of taxpayer dollars at risk….
Sarbanes-Overkill: We
don't need the government to force businesses to spend half their profits on accountants, because free
markets police themselves. Those that serve customers well are rewarded with more customers; those
that do well for investors attract them. Bad guys who cheat get a reputation for cheating. They
lose customers, lose investors and go out of business.
Enron: Under-Regulated or
Over-Subsidized? The problem was not the lack of government involvement with
Enron, but rather the close relationship between Enron and government. Enron in fact
was deeply involved with the federal government throughout the 1990s, both through its
lobbying efforts and as a recipient of large amounts of corporate welfare. Enron
provides a perfect example of the dangers of corporate subsidies. The company
was (and is) one of the biggest beneficiaries of Export-Import Bank subsidies.
Enron, Bankruptcy,
and Easy Credit: The shocking and sudden demise of America's seventh-largest
company raises serious issues about stock valuations and the financial health of America's
big companies. People are understandably angry, especially those who suffered serious
financial losses. However, we should be careful not to blame the free market for the
actions of a few in what is actually a very highly regulated market.
Labor’s “Enron”
Scandal: Last year, labor leaders like John Sweeney of
the AFL-CIO seized on the opportunity to denounce scandals at Enron, WorldCom and
other corporations to help drum up support for Democrats in the 2002 elections and
shift political power to labor unions.
Enron
and Clinton — Corrupt Bedfellows. The leftist
attempt to paint the Enron bankruptcy as a Bush scandal includes
a badly made-for-TV movie produced by CBS called "The
Crooked E." …[T]he CBS TV sit-com and its leftist
spin flopped like a dead fish when confronted by facts. Enron
and Bill Clinton were the best of bedfellows in corruption.
Criminalizing
business: The accounting scandals that received so much government and
media attention involved about a half dozen firms. Out of the thousands of publicly
listed companies, the malefactors comprised a few ten-thousandths of one percent.
Unlimited
Liability: The mass scapegoating of American businessmen is a
monstrous injustice. The profit motive, contrary to popular belief, is not
an impetus to evil; it is a highly moral desire for earned success and
material well-being.
Senators
Ignore Their Own Deceit While Condemning Corporate Deceit.
Did the Press,
the Politicians and the Public All Get It Backwards? Not only do
investors (and most everyone else) have it wrong about Enron and the
stock market, the facts show that they have it backwards.
Cooking
the Books at Taxpayer Expense: The growing concern about financial
accountability needs to also turn its focus to the billions of dollars in financial
mistakes made by the federal government every year. President Bush and members of
Congress may have come out strongly against corporations that mislead the public
with creative accounting methods, but their silence on the same type of
misbehavior going on at government agencies is deafening.
Capitalists
vs. Crooks: The laws necessary to prove fraud and to punish the guilty
already exist, and should be objectively applied. New regulations won't deter the
dishonest few — but will hamstring the innocent.
Federal
government's bookkeeping needs fixing, too. Concealing
debt and operating costs. Flouting court orders by shredding
documents. Failing to properly track assets and liabilities. These
misdeeds have blackened corporate America's eye and prompted criminal
investigations and the wrath of Congress and President Bush. Yet
these same accounting failures and sleights of hand have for years been
common practice in the federal government, fiscal experts say.
The
Fraud of Corporate "Reform": [The federal government has played a] role
in the market meltdown: that of the tax code and federal investment guidelines in
encouraging many of the accounting practices now blamed for ruining
investor confidence.
Left-wing
agenda at corporations? Far too little attention is given to the fact
that, although big corporations are supposedly the nation's institutions that preserve
and promote freedom and capitalism, the reality often is just the opposite.
United
Way executives say donations distorted: Some United Way organizations,
trying to appear more successful and more efficient with their donors' money, are counting
contributions in ways that make the numbers look more robust — and
expenses look smaller.
Crooks in suits: From oil tycoon
J.R. Ewing in Dallas to corporate raider Gordon Gekko in Wall Street, businessmen have been
Hollywood's stock villains for decades. An occasional doctor, lawyer, mechanic, or teacher will be
the bad guy in a TV drama or movie, but studies show that Hollywood holds a particular hostility toward
the corporate world.
Just Another Veiled Attack on Private
Property: The recently passed amendment to the Senate's Sarbanes bill preventing corporations from
making loans to their officers is just another step in the socialization of private property in
America — and must be fought on that basis.
Watch out! The Liberals are Attacking
Again. The recent revelations that both President Bush and Vice President Cheney may have violated
laws while working in the private sector has added more fuel to the corporate American fire.
Enron
Tainted Democrat Contributor Has Big Role in Bush Administration: Political
analysts are questioning the wisdom of the Bush administration in selecting a prominent
Democratic donor with extensive ties to the Enron business scandal as the manager of
a $350 million taxpayer supported development project in Africa.
Amtrak: The Federal Government’s Own
Corporate Financial Scandal. Amtrak has for years used creative
accounting to disguise its financial problems, hiding operating expenses as capital
costs, as well as misled the public about its effectiveness and performance. If
honest accounting practices had been enforced with Amtrak, it would have gone bankrupt
years ago.
Real Treason By Congress: The War Against
Business: This amendment to the Homeland Security bill is about Democratic lawmakers trying to
capitalize on the recent corporate accounting scandals to seize as much private wealth and control over American
industry as they can, before the people eventually wake up and attempt to reassert their right to engage in free
commerce.
Congressional Hysteria Will Not Make Every Businessman
Honest: Why, despite a never-ending slew of new business regulations over the past 100 years, does
business dishonesty still occur? For more than 100 years our intellectuals, specifically our college
professors, have been teaching students, including, future businessmen, that no absolute principles or standards
exist, that you cannot be certain of anything, that the future is unknowable, that it is okay to try anything
without thinking, that the truth is simply that which works at the moment, and that which works is what makes
you feel better right now. In other words, there is nothing really wrong with dishonesty.
Killing
Capitalism in Order to Save It: What’s really scary isn’t the corporate
scandals, but what government will do to fix the problem.
Rules are no substitute for
character: Did you know that the current accounting scandals have their origin in government
rules? The public needs to know the real cause of the scandals before Washington inflicts yet more
damage on our institutions.
Global Crossing Tied to Clinton
Defense Secretary: A top Clinton administration official, former Defense Secretary William Cohen,
sits on the board of Global Crossing. This is the telecom giant that went belly up Jan. 28 in the
fourth largest bankruptcy in U.S. history, leaving a trail of inflated revenues, top executives enriching
themselves, employees and shareholders holding the bag, and Arthur Andersen acting as both consultant and
auditor. If this sounds familiar, it is because this is a replay of the Enron script. However, the
Global Crossing scandal has direct political links, whereas unhappy Democrats have failed to find an improper
Bush-Enron tie.
Enron Gave Big Bucks to Democrats,
Backed "Global Warming" Scam: Bill Clinton pushed the economy-destroying Kyoto "global warming"
treaty, rejected by the Senate 95-0, after Enron gave Democrats $420,000.
Clinton on corporate
corruption: "It ain't my fault". Former President Clinton says the bull market of the 1990s
bred corporate corruption but that President Bush's laying blame on his predecessor twists the
truth. (That's something he knows all about!)
[Part 1 of 3]
Enron
and the Clinton Administration: Ties That Bind While Capitol Hill
Democrats have been trying with limited success to tie the Bush administration
to the energy conglomerate Enron Corporation, the now-bankrupt firm actively
cultivated a long-term relationship with the Clinton administration, according
to documents obtained by CNSNews.com and authenticated by the company.
[Part 2 of 3]
Enron: Courting
Clinton and the Environmentalists While Congressional Democrats
try to link the now-bankrupt corporation with the Bush administration and the
Republican Party, there is evidence that Enron actually aligned itself
with the environmental lobby, which put the company squarely
at odds with most of the GOP on climate change issues.
[Part 3 of 3]
Enron Capitalized on Clinton
Alternative Energy Plans: Two executive orders (12902 and 13123) and other Clinton administration
initiatives laid the groundwork for the Enron Corporation to profit at the expense of American taxpayers,
according to Enron documents obtained by CNSNews.com and authenticated by the company.
Public Believes Bush, Not Dems, on
Enron: A few more developments like this and the media will magically demote the Enron story to
the back pages: Americans believe that Enron Corp. has influenced congressional Democrats but not
President Bush.
Union Leaders Accused of Profiting
From Insider Trading: "These guys got rich, basically, off the workers they're supposed to be
protecting," said Dan Cronin, spokesman for NRTW. "This is exactly what Enron did."
California
Attorney General says chief of energy company
should be jailed and raped. The growing impression that the
once-proud Democrat party has fallen into the hands of socialist thugs
got a boost from California Attorney General Bill Lockyer when he told
reporters he would like to see Enron Chairman Kenneth Lay locked in a
cell and raped by another inmate.
Judicial
Watch Files Suit Against Enron: "The problem with
Enron is much deeper than the financial fraud widely
reported in the press," Judicial Watch Chairman and General Counsel Larry Klayman
said. "The root problem is the pervasive political, business and legal corruption
that exploded during the 1990s." (Note: Who was
the president of the US during most of the 1990s?)
Insanity
or Tyranny? Senator Fritz Hollings, Democrat-SC, recently said that the
whole Enron mess proves that we need a constitutional amendment so Congress could
limit what a politician spends on running a political campaign. A generous
interpretation of the comment would be that Hollings has gone senile,
and didn't know what he was saying, or that he was insane and not
responsible. I think the Senator was out to attack one of our
fundamental rights, and establish a tyranny.
Let
the Investigations Begin: Since the Democrats have suddenly gotten
religion over the issue of ethics – in both the White House and corporate America – we
should all take this once-in-a-lifetime chance to implement some major reforms and
do some housecleaning. Let’s start with government accounting practices, because
no one – not even Enron and WorldCom – knows how to manipulate
numbers like the Congress and governmental agencies.
More
slander: Serious political debate evidently consists of
randomly accusing your opponent of being a hateful bigot or having
some vague ephemeral association with corporate crooks.
Little
Caesars in the Senate: A "little Caesar," before it
referred to a pizza delivery mascot, used to refer to a petty
official -- or gangster -- with delusions of grandeur, the type
who seeks power for the pleasure of abusing it. The Enron
investigation is making it clear that the Senate is
full of these characters.
Does
Dan Rather Have No Shame?: Dan Rather did it again
tonight [1/29/2002], leaving a key factor embarrassing to
Democrats out of a major story. In a segment
on "CBS Evening News" dealing with the massive bankruptcy of
fiber-optic cable company Global Crossing, Rather totally
ignored Democrat National Committee Chairman Terry McAuliffe's
involvement in what could be as big a scandal as the
collapse of Enron.
California
Government Policies are Still to Blame for the Electricity
Crisis, Despite Enron: New study shows how public policies
caused California’s electricity crisis and how legislators should respond.
The
Baxters' Baffling Behavior: There is something very strange about
the behavior of Cliff Baxter, the former vice chairman of
Enron, and his wife, Carol.
Baxter
Death Looks a Lot Like Foster's: The death
of J. Cliff Baxter, the former vice chairman of Enron,
looks a lot like that of former White House Deputy Counsel
Vincent W. Foster Jr.
Cracks
in Cliff Baxter Case: Carol Baxter may regret
having fought so hard to keep the police from releasing the
suicide note allegedly written by her husband, Cliff Baxter,
the former Enron vice chairman. The note was released in
spite of her efforts to keep it secret, and copies were published
in papers around the country.
Enron
Gave Big Bucks to Democrats, Backed “Global Warning” Scam: Scandal-plagued
Enron Corp., cited by Democrats as a big giver to President Bush
and the GOP, gave a cool $420,000 to Democrats when the corporation
was desperate to get the Clinton administration's help in having
the potentially disastrous Kyoto treaty made the law of the
land. Senate ratification of the treaty, which foes explained
would have cost the U.S. billions and had a deadly
effect on the U.S. economy, would have been a
bonanza for Enron.
Clinton
“sweetheart” deal sped up Enron's collapse: After
investing $1 billion in India plant, Lay
couldn't get state utility board to pay.
Enron
execs were regulars on Clinton trade trips: Company
gave $100,000 after Lay got seat on lucrative junket to India. Enron
contributed some $530,000 to the DNC during the 2000 election alone.
Liberal
press is mute on DNC chief’s windfall from latest bankrupt company: The
notable absence of a late-breaking news story from mainstream
media Web sites Tuesday afternoon [1/29/2002] spoke volumes about
the blatant liberal bias that saturates most of the nation’s
newsrooms. As details surfaced about another major corporation
filing Enron-style Chapter 11 bankruptcy, CNN, MSNBC, ABC, NBC
and CBS never saw fit to give the pivotal news story any place
in cyberspace, much less on their TelePrompTers. The reason: This
latest bankruptcy filing links a prominent Democratic figurehead to
possible insider trading. That’s reason enough for the liberal
press to ignore it.
Would
"Deep Throat" Play a Second Time? Enron
failed early in Bush's administration. The mistakes and
shenanigans that brought down the company occurred during the
Clinton administration. The cooked books happened before
President Bush was elected. But facts don't matter to a
news media that serve as the propaganda arm for the
Democratic Party. True to form, The Washington Post
on Jan. 24 gave an entire page to a "primer" on Enron. Under
the section "Political Interactions," the propaganda organ
listed only Republicans.
Enron,
Round 1: Bush: Let's be clear about one thing: Bush
has two enemies, Democrats and the press. They both desperately want
a major scandal. Democrats have been hurt by September 11 and its
aftershocks. Suddenly they're confronted by an enormously popular
Republican president, who now owns the national security, economic,
and education issues.
Corporate
Scandals: Where the Real Accountability Lies. The recent
corporate scandals are the direct result of two separate, yet related
problems: CEOs and stock analysts who try to fool the marketplace by
pursuing high-risk short term strategies that can never succeed in the
long run; and, more importantly, a U.S. tax code that places a premium
on dishonest accounting and misleading the public.
After
Enron: The Cure is Worse Than the Disease. After any
breakdown of a public institution, politicians feel the urge to "fix"
things so it doesn't happen again. Often, however, the cure is worse
than the disease. That's the case with the proposed remedies following
the collapse of Enron.
Jesse
Jackson Admits Contributions From Enron: Jesse
Jackson admitted Tuesday [1/29/2002] that he has received of
Enron Corp. contributions. He did so during an exclusive
interview with CNSNews.com and while accompanying a busload
of former Enron employees to Washington so they could complain
to Congress about the loss of their retirement funds.
Jesse
Jackson Hedges on Enron Donations: Jesse Jackson,
who first denied receiving any political contributions from
Enron Corporation, then admitted he had received only
a "minuscule" amount, Wednesday [1/30/2002] changed his story again.
Somewhat related...
Pinstripes and Black Hats: Businessmen
are Hollywood's Favorite Bad Guys. The Washington-based Media Institute
has found that by the age of 18, the average TV viewer has seen businessmen attempt more
than ten thousand murders and countless lesser offenses, all in the name of greed.
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