Status of High-Profile Corporate Scandals
NewsMax.com Wires
Tuesday, March 15, 2005
A look at some of the most high-profile recent corporate scandals and the status of pending legal action.
WorldCom Inc.: Former CEO Bernard Ebbers was convicted Tuesday of federal fraud and conspiracy charges for his part in a massive accounting fraud now estimated at $11 billion.
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Martha Stewart: The founder of the homemaking empire was released last week after serving five months in prison, and is serving an additional five months confined to her home. She was convicted in federal court last year of conspiracy, obstruction of justice and making false statements related to a personal sale of ImClone Systems Inc. stock. Her former broker at Merrill Lynch, Peter Bacanovic, began serving a five-month sentence in January.
Tyco International Ltd.: A New York state court jury acquitted former Tyco lawyer Mark Belnick last year of charges that he stole millions of dollars by accepting an illegal bonus and abusing company loan programs. Also last year, a state judge declared a mistrial in the case involving former CEO L. Dennis Kozlowski and former CFO Mark Swartz, who were accused of stealing $600 million from the company. The judge said there had been undue pressure on one juror. A retrial is under way.
Adelphia Communications Corp.: Founder John Rigas and his son Timothy were convicted in federal court last year of conspiracy, bank fraud and securities fraud. Another Rigas son, Michael, was acquitted of conspiracy charges before the case ended in a mistrial with jurors deadlocked on 17 counts against him. A fourth executive, Michael Mulcahey, was found not guilty of conspiracy and securities fraud.
Credit Suisse First Boston: The company's former investment banking star Frank Quattrone was convicted in May on federal charges of obstruction of justice, after his first trial ended in a hung jury. Quattrone, who made a fortune taking Internet companies public during the dot-com stock craze, was sentenced to 18 months in prison.
Enron Corp.: Former chairman and CEO Kenneth Lay, former CEO Jeffrey Skilling and chief accounting officer Richard Causey are scheduled to be tried early next year on federal fraud and conspiracy charges.
HealthSouth Corp.: Fired CEO Richard Scrushy is on trial in Birmingham, Ala., on federal charges of leading a multibillion-dollar scheme to overstate HealthSouth earnings to make it appear the company was meeting Wall Street forecasts.
© 2005 The Associated Press
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