Corporate Fraud
I guess it took another tragedy besides September 11, 2001 for the country and the President of the United States, George W. Bush, to realize that big corporations and their super-rich executives are out of control. We needed to take the bull by its horns, so the President signed the Sarbanes-Oxley Act (SOX) of 2002, which is a law that will act against people who don’t have confidence in our markets (Hitt, 2). The tragedy was in November 2001. The Enron Corporation, one of the largest electricity and natural gas traders, announced a $618 million third-quarter loss, Enron admitted to overstating its earnings by $567 million since 1997. This, of course, led to filing for chapter 11-bankruptcy safeguard, and then the announcement of 4,000 employee layoffs.
Along side the biggest bankruptcy in US history was the shocking $1 billion in lost retirement funds to those employees’s laid off (Licht, 17). Enron was not the only corporation laying off its employees; there was also Tyco, WorldCom, Qwest Communications, Global Crossing Ltd, and the stock happy selling of Martha Stewart. With everything else going on in our country today, our President needs to be a strong nation’s corporate cop.
Millions of working Americans have lost their retirement securities by malfeasance, while business executives keep on enjoying golden parachutes (Paige, 3). They perform poorly and get amazing bonuses, but not many hard workers are laid off. With all of the distrust and dishonesty going on in corporate America, this is what raises prices of the products, laying off important workers loses interest with consumers and
ends in the loss of jobs for middle class people. Those people then experience malfeasance with their retirement funds.
I think a stronger government control will eliminate multiple high-ranking chiefs of staff for each large corporation, because it will cut the payroll and put the power back into the shareholders hands....
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