Sept 9 2013
Last October 30, 2013 I began a list of Who's the Worst in anticipation of teaching Ethics in the spring. Today's news suggests it is time to begin again. It will be hard to top the story of Rita Crundwell. Ah, she is back in the news, I googled for a link and by golly, Rita has appealed her 20 yar sentence. After stealing some $54 Million from the residents of Dixon, IL, Rita now denies that they were victims, just parties of interest. Well nothing like a rationalization once you are behind bars. We will put Rita back on the list as we learn what the prosecutors will say to this novel appeal.
But already we have some candidates whose names we have seen before. As I learned last year I need to allow for multiple categories so here goes.
Idols with Clay Feet
Michael Dell was hailed as the smartest guy in Austin, or at least Round Rock, just ten years ago. Who could go wrong buying Dell Stock a realtor asked me at the time? Today Mike is scrambling to stay in charge of his own company. He bumped the bid to go private a dime to $13.75 plus a 13 cent dividend to exiting shareholders. The ethical question here is, should Mike get to stay on after failing to deliver value for shareholders? He gets to vote all his shares which of course he got for free anyway, gee is that ethical?
Dr. Kern Wildenthal Past President of the UT Soutwhest Medical School in Dallas, resigned his positon in late 2012. He had worked there for 42 years, 22 as President. The endowment grew by $1 billion while he was president. Yet in appropriate billings for travel brought him down. This resulted in a $140,000 audit by Grant Thornton. I leanred of this at a presentatino by UTSA auditors at the August SA IIA meeting. For example, he claimed he had visited a hospital in New Zealand on a trip. Yet a call to the hospital revealed he had not done so. No doubt he was well compensated, I would guess that job paid several hundred thousand by year 2000. Yet he frittered away his steallar career for a few trips.
Tobin Smith canned at Fox Business. Tobin in paid to tout stocks and does so in his business. While he did not mention this firm on the air, viewers bought and complained. Tobin failed the smell test and is out.
Business Gone Rogue
Just Plain Mean - Two Hispanic women were indicted for conspiracy and wire fraud. Yolanda Hernandez de Arteaga and Maria de Lourdes Montano Vicencio coaxed immigrants in La Vernia to pay them for legal immigration status. They received over $100,000. When no documents were forthcoming they threatened to turn their victims in for deportation. This is particularly sad as the Hispanic immigrants naturally trusted other Hispanics which of course is how the women pulled off the scheme.
Raul Weil has agreed to extradition to the USA. Raul has been on the lam with US authorities wanting him for helping tax evaders via the familiar Swiss Bank Account. Raul was a high up with UBS.
Well it's All in the Family. Jesse Jackson Jr starts a 30 month jail term for mis use of his campaign funds. Wife Sandi gets 12 months for fraudulent tax return filing.
Politicans Gone Wild
Joe Santiago, a former Democrat State Representative, got four years to do in his part of the bribery ring of State District Judge Abel Limas. We mentioned this case last year. One lawyer who plead guilty and was facing a similar four years or so, took his life by diving off a bridge.
Kathleen Parker has Anthony Weiner defining deviancy down. As Kathleen points out, we are somehow letting people off the hook for exposing themselves on the internet as opposed to doing the same n a public park. This has led to some truly creative headlines on the part of Drudge. will he stay in the race, will he become the next Mayor of New York City, the primary is Sept 10, all the more reason to start our list now.
Eliot Spitzer was Attorney General and then Governor of New York State. He resigned in 2008 amid evidence he was involved in a prostitution ring, which as Heidi Fleiss can attest is actually illegal in this country. Spitzer is back, now running for New York Controller, is dodging questions about a girl friend. His wife is not on the campaign trail. Hey folks, guys like this are the gift that keep on giving for an Ethics Teacher.
We don't really mean to be salacious on this blog, perhaps this political section needs at least an R Rating, but honeslty we just report, you decide. San Diego Mayor Bob Filner begins a two week therapy session for, well you read the story, but once again conduct unbecoming to women. Will 70 year old Filner become cured in two weeks? We'll be on the story!
August 2013, sure enough after 18 women accused Filner of improper behavior, he has agreed to step down August 30.
Jorge Juan Torres Lopez, former Governor of Coahulla, and his Finance Minister have been indicted. They are charged with embezzling $250 Million from Mexico and money laundering via JP Morgan Chase. They are fugitives as I write today which is Thanksgiving. There is a lot of tough talk about how the IRS finds their man. Gee I would think a hefty bounty would bring some fast results.
Toronto Mayor Rob Ford will not resign despite a video of him smoking crack cocaine. I assume this habit is illegal in Canada but this speaks to the larger issue of appropriate behavior.
Florida R Congressman Henry Radel pleads guilty to buying cocaine, at duPont Circle Washington DC no less. Forida Republicans call for his resignation, he plans none. He got a year's probabtion.
John Beale told the EPA he was CIA, missing months of work and embezzling $900,000. Here is more detail of his long term con job on the EPA. He plead guilty and then took the fifth infront of Congress. And he will get his government pension. Where was the GAO, the internal auditors? THis is a good example of why internal auditors need to perform payroll audits to insure people show up for work, that there no ghost employees, and that internal controls are working. As one Congressman opined, what does it take to get fired at the EPA?
Silvio Berlusconi finally gets the boot out of the Italian Senate. Why do you ask? Silvio and 'bunga bunga parties.' And then there was the conviction for tax fraud. As the first article says, this 20 year spree is at an end. But then taxes tend to be so high in Italy and a few other notables like Sophia Loren have run afoul of authorities.
Sports Figures
Major League Baseball dumps players for using performance enhancing drugs. A Rod sells Miami Home for $30 million.
NCAA investigates Johnny Manziel for allegedly taking money for autographs. Actions have consequences. Now A & M has to make some decisions. If they play JM and he is found guilty, they forfeit any games won when he plays. But the star quarterback led the team to last year's 11-2 outcome, so benching him means re making the team strategy.
Lance Armstrong sued the London Sunday Times and won 300,000 pounds over an article which claimed he used performance enhancing drugs. Once he admitted this last year that he had, the paper wanted both the 300,000 plus their 720,000 pounds in court costs. Lance has now settled with the paper. I expect most of his future will be consumed as a legal defendant.
Accountants
DeLoitte fined $22 M for advice to MG Rover. The oversight group in England has been criticzed for being soft on accountants. the largest previous fine was a mere $1.4 M. I'd say they are getting serious.
Former KPMG Partner Scott London pleads guilty to passing insider trading information. What makes this case most interesting is that London traded the information for apparently well less than $100,000 cash and a Rolex Cosmograph Daytona watch. As the Los Angeles Audit Partner he surely drew a salary of over $400,000 plus bonus. KPMG had to withdraw as the auditor for two of the clients invoved.
Book mark this page, it is bound to grow in the coming months!
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