He got a reduced sentence, originally it was 85 years in prison. Yet he got a sentence of 10 months of house arrest, because he helped convict five of his co-workers. Kugel is very embarrassed and ashamed of what he had done to help Madoff go through with his scheme. Also as part of Kugel’s sentence he had to do 200 hours of community service and give up 7.17 million dollars. The five that Kugel turned in were all tried separately.
Shani Davis 11/6/16 “Enron Corporation” Enron, the US Energy Trading and Utilities Company grows in just 15 years into one of America’s largest and most successful Corporations. Enron’s officials ignored warnings of accounting irregularities, as they pocketed millions of dollars in stock market gains. When the company collapsed, they declared bankruptcy and thousands of people are thrown out of work. The investors, including most of Enron’s employees lose billions, as Enron’s shares sink to penny stock levels. The top executives walk away with millions in profit until the government comes calling.
In the end Investors lost over fifty billion dollars and Bernie Madoff ended up in jail with a life sentence. It all began in 1959 when twenty two year old Bernie Madoff registered Bernard L. Madoff Investment Securities as a Brokerage Firm for only $200. He began getting clients through his father-in-law Alpern. The SEC allowed for Investment advisors to have up fifteen clients before requiring a Investment Advisors License that would include many fees and examinations. Bernie Madoff Decided against getting the license and began his life of illegal investing.
This paper is going to discuss the “Vivendi Universal Accounting Scandal”. The issue that happened with this co... ... middle of paper ... ...and the liabilities increasing. Some decisions that had been taken by the former CEO made the company about to bankrupt, it seemed to be a small decision but it affects the company dramatically. The result was that Messier prohibited from becoming an officer for ten years and a manager for five years, and his lawsuit to get 21 million Euros for severance package was cancelled, additional to that he paid 1 million dollars for misleading the company and providing false information about the debt of the company. But despite Messier left the company he created, Vivendi still alive (Matlack & Grover, 2002).
Kenneth Lay was the CEO of Enron at that point, and he hired Jeffery Skilling, who dealt with asset and liability management, as a consultant to co... ... middle of paper ... ...of the largest accounting firms in America, in charge of auditing Enron then became involved, and destroyed any of Enron’s documents that could prove that they were breaking the law. Consequences and Conclusion In the end, Enron could not keep itself afloat once it turned to fraud. Shareholders lost $74 billion, thousands of employees and investors lost their retirement accounts, and many employees lost their jobs. Lives were ruined. Lay died before serving time.
Two years later he pleaded guilty and agreed to work with authorities in exchange for a reduced punishment. He was first sentenced to 10 years in prison, but later his sentence was reduced to 6 years in federal prison and a forfeiture of almost $23.8 million in assets. His wife was former Enron assistant treasurer and she also was sentenced to one year in federal prison for tax fraud. Today, he presents a lot of speeches. He is amazed by: “No one ever asked me to give a presentation when I was CFO of Enron.
The company’s external auditor just happened to be Arthur Andersen, one of the large accounting firms that no longer exists today. Peregrine Systems, Inc. later filed for bankruptcy and was eventually bought by HP, which still operates a portion of its company today. Suspicion into Peregrine Systems, Inc. arose when the company reported 17 consecutive quarters of revenue growth that met or exceeded Wall Street analysts’ expectations. In 1999 Stephen Gardner, CEO made $4.5 million, the highest paid CEO in all of San Diego. In March of 2000 the stock price topped $79.50.
A second report in 2003 found that during Ebber’s 2001 tenure as CEO, the company had over-reported earnings an understated expenses by an astonishing $74.5 billion dollars (Martin, 2005, para 3). This report included the mismanagement of funds, unethical lending practices among its top executives, and false bookkeeping which led to loss of tens of thousands of its employees. They also uncovered a series of clever manipulations intended to bury almost 4 billion in misallocated expenses and phony accounting entries (Moberg &, Romar, 2002, section 5, para 1). Hoping too sway the jury with an “ignorance is bliss” defense, he braced for the verdict. In hi... ... middle of paper ... ...rell, G (2005).
Even after all this, the company’s executives told the investors that the stock was just undervalued and they wanted their investors to keep on investing. The investors lost trust in the company as stock prices decreased, which led the company to file bankruptcy in December 2001. This shows how a lack of transparency in reporting of financial statements leads to the destruction of a company. This all happened under the watchful eye of an auditor, Arthur Andersen. After this scandal, the Sarbanes-Oxley Act was changed to keep into account the role of the auditors and how they can help in preventing such
His job was to turn Enron Energy Services into the biggest trading firm in the business. After spending several nights and thousands of company dollars on strippers, he got one of them (Melanie Fewell) pregnant. Both got a divorce and Pai cashed out all of his Enron stock to the tune of $250 million dollars. This put 800,000 shares onto the market and the price fell from $90 to $53 a share. The fact that he sold his shares before Enron’s bankruptcy protection meant that he didn’t get caught for insider trading like the rest of the executives.