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In 1983, while in a small coffee shop in Hattiesburg Mississippi, Bernard Ebbers developed the business concept that would eventually become the second largest long distance telephone company in the United States, WorldCom (Romar and Calkins). In 2002, the company that Bernard Ebbers grew from the ground up declared the largest bankruptcy in United States history. The unethical and illegal accounting treatments that WorldCom participated in eventually led to the demise of the company and a new company, MCI, rising from the rubble of what was WorldCom.
There were two main issues that provided pressure for the senior executives at WorldCom to commit fraud. WorldCom became the second largest long distance telephone company because of its execution of a very aggressive acquisition strategy (Moberg and Romar). During the years 1991 through 1997, WorldCom completed 65 acquisitions, the most notable being that of MFS Communications and MCI Communications (Moberg and Romar). At the height of WorldCom’s power, their stock was trading at upwards of $60 per share (Moberg and Romar). As the company’s stock continued to rise, WorldCom continued to acquire companies (Moberg and Romar). However, mergers and acquisitions create significant managerial challenges (Moberg and Romar). The first challenge is to combine the newly acquired company and the already existing company to create one smoothly functioning business (Moberg and Romar). This process can be extremely time consuming, and WorldCom executives did not seem to have the needed time. The second challenge is to account for the financial aspects of the acquisition (Moberg and Romar). During this process, all assets, debts, goodwill, and many other financial information must be ...
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...nsylvania. 14 March 2011 .
Katz, David and Julia Homer. "WorldCom Whistle-blower Cynthia Cooper." 1 February 2008. CFO.com. 15 March 2011 .
Moberg, Dennis and Edward Romar. "WorldCom." 2003. Markkula Center for Applied Ethics. 2 February 2011 .
Pulliam, Susan and Deborah Solomon. "How Three Unlikely Sleuths Exposed Fraud at WorldCom." 30 October 2002. The Wall Street Journal Online. 2 February 2011 .
Romar, Edward J. and Martin Calkins. "WorldCom Case Study Update 2006." February 2006. Markula Center for Applied Ethics. 2 February 2011 .
While the widely exposed and discussed trials of WorldCom's and Tyco's top executives were all over the media, one of the most interesting cases of securities fraud was happening without any public acknowledgement.
Nye, Howard. PHIL 250 B1, Winter Term 2014 Lecture Notes – Ethics. University of Alberta.
In a series of experiments conducted from 1960 to 1963, American psychologist Stanley Milgram, sought to examine the relationship between obedience and authority in order to understand how Nazi doctors were able to carry out experiments on prisoners during WWII. While there are several theories about Milgram’s results, philosopher Ruwen Ogien uses the experiment as grounds for criticizing virtue ethics as a moral theory. In chapter 9 of Human Kindness and The Smell of Warm Croissant, Ogien claims that “what determines behavior is not character but other factors tied to situation” (Ogien 120). The purpose of this essay is not to interpret the results of the Milgram experiments. Instead this essay serves to argue why I am not persuaded by Ogien’s
Margaret R.,DeCosse, David, Andre, Claire, & Hanson Markkula, Kirk O. (1988). Center for Applied Ethics at Santa Clara University. Issues in Ethics, V. 1, N. 2. Sobel, Russell S. &
While Enron was the complicated fraud, WorldCom fraud was the simplest one to commit. WorldCom which is now known as MCI and acquired by Verizon Communication since 2006 was founded in 1983 to create a discount long-distance provider. The company grew very rapidly in the 1990s because of several large acquisitions (Beresford, Katzenbach, & C.B. Rogers, 2003) WorldCom completed 3 mergers in 1998 and one of the merger was the acquisition of MCI Communications Inc for $40 billion, the largest merger at that time. WorldCom also merged with Brooks Fiber Properties Inc for $1.2 billion and CompuServe Corp for $1.3 billion (The rise and fall of WorldCom, 2008). WorldCom announced the merger with Sprint Corp. in 1999 and its shares’ price went up for more than $64 but, the merge was blocked by regulators in both the U.S. and Europe because they concerned that it would create a monopoly in 2002 (The rise and fall of WorldCom,
Torres Gregory, Wanda, and Donna Giancola. "Part 1: The European Traditions." World Ethics. Eds. Steve Wainwright, Lee McCracken, and Anna Lustig. Belmont, CA: Wadsworth, Cengage learning, 2002. 142-147. Print.
In modern day business, there can be so many pressures that can cause managers to commit fraud, even though it often starts as just a little bit at first, but will spiral out of control with time. In the case of WorldCom, there were several pressures that led executives and managers to “cook the books.” Much of WorldCom’s initial growth and success was due to acquisitions. Over time, WorldCom discovered that there were no more opportunities for growth through acquisitions when the U.S. Department of Justice disallowed the acquisition of Sprint.
Thiroux, Jacques P., and Keith W. Krasemann. Ethics: Theory and Practice. Upper Saddle River, NJ: Prentice Hall, 2009. Print.
Wilson, James. “Transhumanism and Moral Equality." Bioethics 21.8 (Oct. 2007): 419-425. Academic Search Premier. EBSCO. 31 Oct. 2008 .
Kidder, R, M., (2010), Center for corporate Ethics, Institute for Global Ethics, retrieved on August 08,2010 from www.globalethics.org/ reserve reading from ethics news line
This paper will examine this ethical dilemma further, including why it is an important issue...
Tavani, H. T. (2007). Ethics and technology. Hoboken, NJ, USA: John Wiley & Sons Inc. (Ethical theories in the introduction)
Tavani, Herman T. "Chapter 4 :Professional Codes of Ethics and Codes of Conduct." Ethics and Technology: Controversies, Questions, and Strategies for Ethical Computing. Hoboken, NJ: Wiley, 2010. Print.
4. Unknown. Ethics. Santa Clara University Markkula Center for Applied Ethics. 29th March 2004. http://cseserv.engr.scu.edu/NQuinn/COEN288/EngrHandbook_Ethics.pdf
Ethics define a broad meaning on the subject itself. Baumhart,R (1987) states that ethics can be separated into 2 things. Firstly, it could be identified as a great level of right or wrong which can relates to the actions of p...