What do AT&T, Boeing, Com-verse Technology, Prudential Financial, Medtronic, Schering-Plough and Tenet Healthcare have in common?
In recent months, they have all been charged with fraudulent conduct by the US Justice Department's Corporate Fraud Task Force, or with serious misconduct by government prosecutors.
Among other charges, the companies were accused of deceptive stock trading, improper billing, falsification of drug prices, kickbacks to doctors and the creation of a "secret stock options slush fund."
The total cost of their misconduct in fines and effective penalties to shareholders? A cool US$2.6 billion.
Almost five years after the Enron scandal first came to light, corporate crime involving major US companies appears to show no sign of abating, despite a government crackdown on corporate malfeasance.
Set up after Enron's collapse, the Corporate Fraud Task Force has taken the lead in prosecuting bad executive behavior.
Critics concede it has notched up major victories, notably the convictions of Enron's two former top executives, but some securities lawyers and investor advocates say corporate fraud has become so endemic that harsher penalties are needed to defeat it.
Jacob Zamansky, a New York lawyer whose firm, Zamansky and Associates, has filed securities lawsuits against big Wall Street brokerages, says more top executives need to be held accountable to deter corporate fraud.
"If the Justice Department is serious about showing enforcement, go after some top guys on Wall Street, in Corporate America," he said.
Zamansky believes the government did an "excellent job" in prosecuting the Enron case and other cases until last year but says that prosecutions have slackened overall this year.
A senior Justice Department official, who requested anonymity, argued, however, that the task force has been clamping down aggressively and that the flurry of recent cases was somewhat of an aberration.
"From July 2002 to March 2006, we've had more than 1,000 guilty pleas; more than 160 of those have been chief executive officers and [company] presidents," the official said.
Key members of the task force, which also groups Securities and Exchange Commission and FBI officials, met just last month to swap notes and plot strategy.
"We certainly seek to recover [money] vigorously and to the maximum extent we can consistent with the facts," the official said, adding that there are no plans to disband the task force.
CALL FOR PEACE: Czech President Petr Pavel raised concerns about China’s military maneuvers in the Taiwan Strait and its ‘unfriendly action’ in the South China Sea The leaders of three diplomatic allies — Guatemala, Paraguay and Palau — on Tuesday voiced support for Taiwan’s inclusion in the UN on the first day of the UN General Debate in New York. In his address during the 78th UN General Assembly, Palauan President Surangel Whipps Jr urged the UN and all parties involved in cross-strait issues to exercise restraint and seek a peaceful resolution. “The well-being and prosperity of nations and their economies are intrinsically linked to global peace and stability,” he said. He also thanked partner nations such as Taiwan, Australia, Japan and the US for providing assistance
CROSS-STRAIT CONCERNS: At the same US Congress hearing, Mira Resnick said a US government shutdown could affect weapons sales and licenses to allies such as Taiwan A Chinese blockade of Taiwan would be a “monster risk” for Beijing and likely to fail, while a military invasion would be extremely difficult, senior Pentagon officials told the US Congress on Tuesday. Growing worries of a conflict come as China has ramped up military pressure on Taiwan, holding large-scale war games simulating a blockade on the nation, while conducting near-daily warplane incursions and sending Chinese vessels around its waters. US Assistant Secretary of Defense for Indo-Pacific Security Affairs Ely Ratner said a blockade would be “a monster risk for the PRC [People’s Republic of China].” “It would likely not succeed, and it
‘HARASSMENT’: A record 103 Chinese warplanes were detected in 24 hours, posing severe challenges to security in the Taiwan Strait and the region, the ministry said Taiwan yesterday told China to stop its “destructive unilateral actions” after more than 100 Chinese warplanes and nine navy ships were detected in areas around the nation. The Ministry of National Defense (MND) described the number of warplanes detected in 24 hours as a “recent high,” while Beijing has so far refrained from issuing any official comment on the sorties. “Between the morning of September 17th to 18th, the Ministry of National Defense had detected a total of 103 Chinese aircraft, which was a recent high and has posed severe challenges to the security across the Taiwan Strait and in the region,”
IMPORTS: Fifty-four million imported eggs with a value of more than NT$200 million had to be destroyed, mostly because they expired in storage facilities Minister of Agriculture Chen Chi-chung (陳吉仲) last night announced that he would resign from his post. Local media on Sunday reported that Chen had resigned due to controversy over the ministry’s egg import program. Later that same evening, the Executive Yuan said that Premier Chen Chien-jen (陳建仁) had asked the minister to stay on to resolve the issue. Chen Chi-chung last night made public his decision to resign on Facebook, saying that this time he would not be dissuaded. Chen Chi-chung earlier yesterday apologized for the furor surrounding the egg import program, but added that misinformation had made the problems worse. The government was