3307
« on: March 05, 2010, 10:06:43 PM »
SSAJI
I know about one Fraud in American History. Enron was a high-flying corporation, generating cash and new business at every turn. Originally a gas pipeline company, it metamorphosed into the world's largest trader in gas, electricity, water, and all sorts of post-modern commodities such as bandwidth. But when in October, 2001 Enron was forced to disclose that, well, its bookkeeping had been too creative, its soaring profits were suddenly wiped out by losses and charges it had failed to record properly. Investors began to have second thoughts about Enron, whose stock, having reached a high of 98 dollars a share, plummeted.
Suddenly Enron found itself in a huge credit crunch, and the corporation imploded. It turned out that many Enron executives had sold tens of millions of dollars of their stock while the public went on buying shares in the company, assured by these same executives that all was well. Worse, Enron executives had authorized a change in the company's pension plan that froze workers' retirement funds in Enron stock as the price nose-dived. While executives sold their stock, the workers woke up to find that their pension plan was worthless.
Since the start of Mr George W. Bush's career in politics, the largest donor to his electoral campaigns has been a man named Kenneth Lay. "Kenny Boy" is how Mr Bush often referred to his friend, indicating the warm and intimate relation between the two. Recently, though, Mr Bush does not return Kenny Boy's phone calls. In fact, he would rather not acknowledge that he knows Mr Lay. The reason? The company of which Mr Lay was president, Enron, just crashed in the largest and most spectacular bankruptcy in American history.
Why did Enron's management engage in such dishonest and ultimately disastrous practices? Because a certain stratum of American culture is money-mad, and the stock market rewards companies whose revenue seems to grow rapidly.Even the Republican Party, which had the responsibility in the recent past of passing legislation that would ease Enron's path into the shady side of business, received $1.2 million in the 2000 election
Show Posts
g.