Word: enronization
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Dates: during 2000-2009
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...there is one lesson to be learned from the Enron fiasco, it is that all should be wary of a corporation announcing a trade that, upon closer examination, isn’t really a trade at all. By using an accounting gimmick to disguise its enormous debts as derivatives trades—known “prepaid swaps”—Enron’s management conned its shareholders and employees out of millions of dollars. Now it looks like the Harvard Corporation is trying to pull the same “false swap” scam...
Holding hearings to yell at Jeff Skilling and Ken Lay was easy. Now, some four months after Enron officially went poof, Congress is finally getting to the hard part - trying to apply won't-happen-again medicine to all those hearts - employees', investors', capitalism's - that were broken by the energy trader's ignoble collapse. And this is where "fixing the system" gets complicated...
...bill - more or less an encapsulation of what President Bush suggested a while back - makes the easy fixes. Companies must warn employees 30 days before freezing trading in their 401(k) retirement plan accounts - remember those Enron victims? - and company executives would be banned from selling their company stock during blackout periods when workers can't make changes to their 401(k) accounts. As for diversification, it also forces companies that use their own stock to match employees' contributions to allow workers to sell that stock after three years. (Enron's threshold was a penny-pinching...
...Democrats, furiously softening the ground for when the Senate comes up with its own version down the road, are already on the attack. None of the GOP's bills "would prevent big corporations from taking advantage of their employees as Enron did,'' said Dick Gephardt and Martin Frost (D-Texas) in a letter to Speaker Dennis Hastert. "We fear that characterizing the committee-passed bills as a response to the Enron collapse would seriously mislead millions of Americans about the security of their 401(k) plans...
...They may be on to something, even if they don't know it. Bush's proposals aren't just designed to keep the Enron stink off him for the midterms; it's also to start the difficult task of prepping people for life under a partially privatized Social Security system...