- Martha Stewart may be the most eye-catching of the recent
crop of corporate miscreants to come to public attention, but she is by
some distance also the most trivial.
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- For all the brouhaha generated by her celebrity status,
she was only ever accused of a personal indiscretion cashing in stock
in a friend's company just before a damaging government report sent the
share price spiralling downwards.
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- Admittedly the size of the indiscretion was not entirely
trivial. We're talking about $230,000 (£125,000) that she took away
from her friend Samuel Waksal's medical research firm ImClone. But that's
small beer compared with the management team at Enron, who set up shell
companies overseas to paint a deeply misleading picture of the company's
profitability, avoided paying corporate taxes almost completely, sucked
the pension fund dry while raking in seven-figure bonuses for themselves
and eventually drove the seventh-largest corporation in the United States
into the ground.
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- Small beer, too, compared with Arthur Andersen, the once-prestigious
accounting firm which imploded because of its close involvement with the
Enron meltdown, or with the Rigas family, who used their publicly traded
cable company, Adelphia, to extend more than $3bn in personal loans to
themselves at the cost of the business itself, or even with Gary Winnick,
the chief executive of the communications network-building company Global
Crossing, who cashed out $374m in company shares shortly before it declared
bankruptcy.
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- It seems almost perverse that of all the corporate scandals
to have sullied the Bush administration's tenure add to the hall of shame
Bernie Ebbers of Worldcom, Dennis Kozlowski of Tyco International, Henry
Blodget of Merrill Lynch and Joseph Nacchio of Qwest Communications, to
name just a few Stewart's venal but ultimately banal exercise in insider
trading should have grabbed so much media space.
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- For a while it seemed as though she could claim scapegoat
status and ask why the chief executives of bankrupt companies and perpetrators
of grotesque acts of betrayal towards employees and shareholders were not
also being hauled into court and tried on criminal charges. "Does
anyone think any of our modern malefactors of great wealth will actually
do time?" Paul Krugman, economic columnist for The New York Times
wrote a couple of years ago, and at the time his scepticism seemed entirely
warranted.
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- More recently there have been signs that Stewart could
be the first of several high-profile defendants to face conviction. Some
28 former Enron employees have now been charged including Jeffrey Skilling,
the company president, and Andrew Fastow, Enron's chief financial officer.
Ken Lay, the chairman and close friend of the Bush family, has escaped
indictment, but opinions vary on how long his exemption might last. This
week, Mr Ebbers of Worldcom appeared in court to face federal charges that
he orchestrated an $11bn accounting fraud at the telecommunications firm.
He pleaded not guilty. Those from Adelphia John Rigas, two of his sons
plus a former company accounting executive are currently on trial in Manhattan
on charges of conspiracy, wire fraud, securities fraud and bank fraud.
They have pleaded not guilty.
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- Also in New York, Mr Kozlowski and a former colleague
from Tyco are on trial on 32 counts including grand larceny, conspiracy,
securities fraud and falsifying business records. The fact that the most
serious charge against them enterprise corruption was dropped yesterday
is likely to come as only partial consolation.
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- © 2004 Independent Digital (UK) Ltd
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- http://news.independent.co.uk/world/americas/story.jsp?story=498377
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