Dan Gillmor on the Corporate Crime Spree
Comments: 1
Read Dan Gillmor’s column on the recent corporate crime spree – “Corporate sleaze carves into our trust” and weep. Gillmor is still somewhat optimistic it seems (the quotes I’ve pulled don’t illustrate this), but I’m certainly not.
Rational people are starting to assume something that isn’t necessarily true. They’re becoming convinced that the system is hopelessly, irrevocably rigged against everyday investors by a corrupt cadre of insiders in boardrooms and on Wall Street, willfully assisted by regulators and elected officials who are either corrupt themselves or simply blind. […]
Cynicism is contagious in circumstances like these, and it’s dangerous. The insiders who grabbed billions from investors, and who left workers and communities wounded, still have their money. Almost no one has been prosecuted, much less punished, for the vast financial crimes of the past decade. If you’re rich or powerful enough, it seems, you can get away with anything.
Of course it’s not necessarily true that there is some “corrupt cadre of insiders” manipulating everything; such a simplistic reduction is extremely unlikely and veers towards Illuminati theories. But there is a growing body of evidence that something is extremely wrong with the system itself.
Elsewhere Gillmor posts a very telling observation. The front page of the Wall Street Journal online edition contains six lead items on possible corporate crime:
- WORLDCOM UNCOVERED what may be one of the largest accounting frauds ever with the discovery of $3.8 billion in expenses that were improperly booked as capital expenditures. See a timeline of WorldCom’s troubles.
- Prosecutors widened the probe of Martha Stewart to include possible obstruction of justice and making false statements related to the sale of ImClone shares.
- The SEC is taking a tough stance on how Qwest accounted for as much as $1.4 billion in sales of fiber-optic capacity.
- Investigators are looking into complex financing deals developed by Citigroup and J.P. Morgan Chase that helped burnish energy companies’ results. In some cases, the big Wall Street firms aggressively marketed the products.
- The Justice Department is investigating the role of several former employees of Greenwich NatWest in some Enron partnerships.
- Adelphia filed for bankruptcy-court protection amid probes into some of the largest self-dealing in U.S. corporate history.
Now stop and think for a moment: how many other current or recent stories could you add to this list? Merrill Lynch, Tyco, Global Crossing … and these are just in the US. Don’t let’s get started on Japan, for example.
Sad to say that none of this is really much of a surprise if you’ve read Thomas Frank’s brilliant One Market Under God.
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Posted to General Rants • 2002.06.27 (Thu) • 22:40
Comments
Posted by Jon 2006.09.25, 21:10
Much of the corporate crime in America is encouraged, even facilitated by lawyers as in the case I describe at www.marciahatch.com and www.blog.marciahatch.com. The HP and options back dating scandals are other examples. If lawyers were actually held accountable for their behavior, which the vast majority are not, they would have an incentive to be more diligent when advising clients and careful not to become ensnarled in facilitating their misdeeds. Of course some lawyers are just bad apples who enjoy “circumventing” the law.
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