Now serving a prison term of 8.25 to 24 years is former Tyco International CEO Dennis Kozlowski, a corporate executive who made lavish executive spending into an art form.
Having been with Tyco since 1975, Kozlowski took over as CEO in 1992 and worked out for himself compensation packages beyond the wildest dreams of avarice.
Company stockholders began to take notice of his excessive compensation, and news began to surface regarding his $30 million Fifth Avenue apartment in New York, a $15,000+ umbrella stand, and--wildest of all--a $6,000 shower curtain.
Then there was the matter of a birthday party held on the island of Sardinia for Kozlowski's wife Karen, who divorced him in 2006. The party was tricked out as a stockholders' meeting and cost the company a reported $1 million, with the high-living CEO contributing a like sum.
These matters, plus allegations of high-ticket art purchases paid out of company funds and absurdly high bonuses for other top corporate brass, led to Kozlowski's resignation in 2002.
Eventually he and his CFO were charged with having stripped the corporation of around $600 million. He was convicted in 2005. His appeal was rejected.
Thursday, September 3, 2009
Disgraced business figure Bernie Madoff
Creator and operator of an incredibly enormous Ponzi scheme, said to have cost his clients around $65 billion, is Bernard Madoff of New York.
Financier Madoff is a rarity: a white-collar miscreant who actually confessed to what he had done rather than pleading not guilty or weasel-wording that he "might have made errors of judgment."
Instead, he pled guilty to duping an enormous number of investors, some of them very wealthy and presumably sophisticated individuals, via what might very well be the biggest Ponzi scheme anyone ever operated.
Madoff started his own Wall Sreet firm, Bernard L. Madoff Investment Securities, in 1960 and grew great wealth for himself and some of his employees, some of whom were family members.
Madoff lived the lifestyle of the rich and famous, with a New York penthouse plus other residences in Palm Beach and France.
In 2008, with trouble closing in, he confessed to his sons that he was operating what amounted to a giant Ponzi scheme. The two younger Madoffs turned him in, and their father was arrested by the FBI straightaway.
For a time, Madoff was held in house arrest, but his bail was revoked and he was taken into custody. He was found guilty and sentenced in 2009 to 150 years in prison, with restitution demands of $170 billion.
Financier Madoff is a rarity: a white-collar miscreant who actually confessed to what he had done rather than pleading not guilty or weasel-wording that he "might have made errors of judgment."
Instead, he pled guilty to duping an enormous number of investors, some of them very wealthy and presumably sophisticated individuals, via what might very well be the biggest Ponzi scheme anyone ever operated.
Madoff started his own Wall Sreet firm, Bernard L. Madoff Investment Securities, in 1960 and grew great wealth for himself and some of his employees, some of whom were family members.
Madoff lived the lifestyle of the rich and famous, with a New York penthouse plus other residences in Palm Beach and France.
In 2008, with trouble closing in, he confessed to his sons that he was operating what amounted to a giant Ponzi scheme. The two younger Madoffs turned him in, and their father was arrested by the FBI straightaway.
For a time, Madoff was held in house arrest, but his bail was revoked and he was taken into custody. He was found guilty and sentenced in 2009 to 150 years in prison, with restitution demands of $170 billion.
Wednesday, September 2, 2009
Disgraced business figure James McDougal
One of Bill and Hillary Clinton's closest business associates, Jim McDougal, died in prison at age 57 in 1998.
McDougal and his wife Susan partnered with the Clintons in the infamous Whitewater land deal while Bill Clinton was governor of Arkansas. At that time, McDougal owned and ran the Madison Guaranty Savings & Loan, from which he took funds to cover losses suffered in the development planned to be built in the Ozarks.
McDougal, a big supporter of the Clintons in politics, used the Rose Law Firm, in which Hillary was a partner, as his legal counsel when charged in 1984 with fraud. McDougal also got into fraud trouble over another development project, Castle Grande, near Little Rock.
McDougal was convicted on 18 felony counts and faced a sentence that would have imprisoned him for many decades, but at that time he began cooperating with Kenneth Starr's investigation of Whitewater and managed to have his sentence cut to three years. McDougal's wife Susan would not cooperate and spent 18 months in prison for contempt. She also received a two-year sentence for bank fraud.
The flamboyant Jim McDougal suffered a heart attack and died about a year before his scheduled release. Before he died, he published a book containing allegations about payoffs to the Clintons and an unfulfilled promise of a presidential pardon for Susan.
McDougal and his wife Susan partnered with the Clintons in the infamous Whitewater land deal while Bill Clinton was governor of Arkansas. At that time, McDougal owned and ran the Madison Guaranty Savings & Loan, from which he took funds to cover losses suffered in the development planned to be built in the Ozarks.
McDougal, a big supporter of the Clintons in politics, used the Rose Law Firm, in which Hillary was a partner, as his legal counsel when charged in 1984 with fraud. McDougal also got into fraud trouble over another development project, Castle Grande, near Little Rock.
McDougal was convicted on 18 felony counts and faced a sentence that would have imprisoned him for many decades, but at that time he began cooperating with Kenneth Starr's investigation of Whitewater and managed to have his sentence cut to three years. McDougal's wife Susan would not cooperate and spent 18 months in prison for contempt. She also received a two-year sentence for bank fraud.
The flamboyant Jim McDougal suffered a heart attack and died about a year before his scheduled release. Before he died, he published a book containing allegations about payoffs to the Clintons and an unfulfilled promise of a presidential pardon for Susan.
Disgraced business figure Michael Milken
One of those all-American stories of temporary disgrace erased by big bucks and good deeds is that of financier Michael Milken, known as the Junk Bond King.
Milken, who emerged from his troubles with more than $2 billion, was charged in 1989 with securities fraud and racketeering due to alleged insider trading and other violations.
The racketeering charges were dropped as part of a plea bargain, but in 1990 Milken plead guilty to several financial market improprieties. He got 10 years, but later, with the help of lawyer Alan Dershowitz, the term was reduced by a judge. Milken served a bit less than two years and emerged still smiling and still very wealthy.
The Wharton School MBA worked for the investment bank Drexel Harriman Ripley, later Drexel Burnham & Company. There, he began dealing in risky but high-yield bonds. Later, he left Drexel to start his own firm, International Capital Access Group.
The wily and successful bond trader has resurrected his public image via good works accomplished through the Milken Institute, the Milken Scholars program, and Milken foundations for research on epilepsy, melanoma and prostate cancer.
Milken, who emerged from his troubles with more than $2 billion, was charged in 1989 with securities fraud and racketeering due to alleged insider trading and other violations.
The racketeering charges were dropped as part of a plea bargain, but in 1990 Milken plead guilty to several financial market improprieties. He got 10 years, but later, with the help of lawyer Alan Dershowitz, the term was reduced by a judge. Milken served a bit less than two years and emerged still smiling and still very wealthy.
The Wharton School MBA worked for the investment bank Drexel Harriman Ripley, later Drexel Burnham & Company. There, he began dealing in risky but high-yield bonds. Later, he left Drexel to start his own firm, International Capital Access Group.
The wily and successful bond trader has resurrected his public image via good works accomplished through the Milken Institute, the Milken Scholars program, and Milken foundations for research on epilepsy, melanoma and prostate cancer.
Tuesday, September 1, 2009
Disgraced business figure Marc Rich
The commodities trader born in Belgium as Marc David Reich, had his name changed to Marc Rich (a downright prophetic choice) after he immigrated to the United States with his family in 1942.
Rich married a shoe company heiress in 1966 and in the early 1970s, contrived to ignore the U.S. embargo on buying oil from Iraq and Iran. This occurred at a time when Iran was holding more than 50 American citizens hostage, and Rich's deals no doubt helped the Iranians and Iraqis purchase armaments. Having bought the oil on the cheap, he then sold it at enormous profit during a period of frightening U.S. gasoline shortages. He established a beneficial relationship with Iran's Ayatollah Khomeini and also founded a big real estate development company in Eastern Europe.
Rich came under indictment for tax evasion and illegal oil trading in 1983 and chose to remain in Switzerland rather than return to America and face charges. He gave up his U.S. citizenship, living the lifestyle of the rich and famous with residences on Lake Lucerne and in the Swiss resort town of St. Moritz and in Marbella, Spain.
Rich lives the very, very good life in Europe, continues doing business deals in Nigeria, South Africa and elsewhere, has been honored in Israel for his philanthropy there, and was a big contributor to the coffers of President Bill Clinton.
In one of his most questionable non-sexual acts as president, Clinton granted Rich a full pardon on Clinton's last day in office. Rich's beautiful ex-wife, Denise, had been a major contributor to Clinton and the Democratic Party and had lobbied hard for the pardon. The pardon, like Bill Clinton's unusual intern policy, was one of his most shameful acts.
Rich married a shoe company heiress in 1966 and in the early 1970s, contrived to ignore the U.S. embargo on buying oil from Iraq and Iran. This occurred at a time when Iran was holding more than 50 American citizens hostage, and Rich's deals no doubt helped the Iranians and Iraqis purchase armaments. Having bought the oil on the cheap, he then sold it at enormous profit during a period of frightening U.S. gasoline shortages. He established a beneficial relationship with Iran's Ayatollah Khomeini and also founded a big real estate development company in Eastern Europe.
Rich came under indictment for tax evasion and illegal oil trading in 1983 and chose to remain in Switzerland rather than return to America and face charges. He gave up his U.S. citizenship, living the lifestyle of the rich and famous with residences on Lake Lucerne and in the Swiss resort town of St. Moritz and in Marbella, Spain.
Rich lives the very, very good life in Europe, continues doing business deals in Nigeria, South Africa and elsewhere, has been honored in Israel for his philanthropy there, and was a big contributor to the coffers of President Bill Clinton.
In one of his most questionable non-sexual acts as president, Clinton granted Rich a full pardon on Clinton's last day in office. Rich's beautiful ex-wife, Denise, had been a major contributor to Clinton and the Democratic Party and had lobbied hard for the pardon. The pardon, like Bill Clinton's unusual intern policy, was one of his most shameful acts.
Monday, August 31, 2009
Disgraced business figure John Rigas
John J., Rigas was a self-made man trained as an engineer. At the time he ran into major-league legal trouble, he was CEO of Adelphia Communications, one of the largest U.S. cable TV companies.
Rigas started his entrepreneurial career by buying a movie theater, then got into the cable TV business, which he grew with great success.
In 2002, he was forced to resign amidst charges of bank, wire and securities fraud. He, his sons Timothy and Michael and two other Adelphia executives were thought to have improperly taken more than $2 billion out of the corporation.
Rigas was found guilty and given a 15-year sentence; the once successful company went into bankruptcy. Son Timothy was also convicted, but Michael was acquitted. On appeal, a judge lessened John Rigas' sentence to 12 years, and the former CEO was unsuccessful at getting a presidential pardon from George W. Bush. Should he live so long, the elder Rigas will be 92 when his sentence has been served.
Rigas started his entrepreneurial career by buying a movie theater, then got into the cable TV business, which he grew with great success.
In 2002, he was forced to resign amidst charges of bank, wire and securities fraud. He, his sons Timothy and Michael and two other Adelphia executives were thought to have improperly taken more than $2 billion out of the corporation.
Rigas was found guilty and given a 15-year sentence; the once successful company went into bankruptcy. Son Timothy was also convicted, but Michael was acquitted. On appeal, a judge lessened John Rigas' sentence to 12 years, and the former CEO was unsuccessful at getting a presidential pardon from George W. Bush. Should he live so long, the elder Rigas will be 92 when his sentence has been served.
Disgraced business figure Robert Vesco
After many years on the lam from U.S. law enforcement, financier Robert Vesco died of lung cancer in 2007 in Havana, Cuba.
Vesco's storied wealth began with his International Controls Corporation in New Jersey. Then in 1970, he took over a mutual fund family, Investors Overseas Service, Ltd., which he then looted.
The Securties and Exchange Commission charged Vesco with defrauding that company of more than $200 million, and rather than face the charges, he rapidly relocated in 1973 to Costa Rica, where he dispensed enough payoff money to prevent his being extradited to America.
In 1978, he moved to Nassau and next to Antigua. He hoped to purchase the island of Barbuda from Antigua and declare it his own sovereign state, but that plan failed.
Next he lived in Nicaragua, and in 1982, he moved to Cuba. There he was charged with drug smuggling, and when Vesco attempted to put one over on Raul Castro in a business deal involving the medicine Trixolan, Vesco was arrested. He was found guilty in a Cuban court and sentenced to a prison term in 1996.
Vesco was scheduled to be released in 2009, but death overtook him at age 71.
Vesco's storied wealth began with his International Controls Corporation in New Jersey. Then in 1970, he took over a mutual fund family, Investors Overseas Service, Ltd., which he then looted.
The Securties and Exchange Commission charged Vesco with defrauding that company of more than $200 million, and rather than face the charges, he rapidly relocated in 1973 to Costa Rica, where he dispensed enough payoff money to prevent his being extradited to America.
In 1978, he moved to Nassau and next to Antigua. He hoped to purchase the island of Barbuda from Antigua and declare it his own sovereign state, but that plan failed.
Next he lived in Nicaragua, and in 1982, he moved to Cuba. There he was charged with drug smuggling, and when Vesco attempted to put one over on Raul Castro in a business deal involving the medicine Trixolan, Vesco was arrested. He was found guilty in a Cuban court and sentenced to a prison term in 1996.
Vesco was scheduled to be released in 2009, but death overtook him at age 71.
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