Word: enronization
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Dates: during 2000-2009
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...Friday left the market at a five-year low, Americans are more worried about their financial future than at any other time since the turbulent '70s. They flocked to stocks in the roaring 1990s, only to see $7.7 trillion of paper wealth incinerated. If the scandal and collapse at Enron had been isolated, the nation's deflated sense of opportunity might have been repaired by now. Instead, the lid has been lifted on bogus revenue-generating schemes throughout the energy and telecom industries; earnings deception on an even broader scale; and the frightening failure of accountants, stock analysts, board directors...
Aside from the obvious problems with 401(k)s--demonstrated in the collapse of plans at Enron, Global Crossing and other once high-flying companies--there are seldom-discussed issues, including poor performance and what is known as leakage. The average 401(k) plan's equity holdings are concentrated in large-cap companies, so their returns track the S&P 500, which has dropped 44% from its peak. Over the long run, experts say, 401(k) returns lag behind professionally managed pension funds by 1 to 2 percentage points a year. And as if meager returns were not bad enough...
...vicious circle of price declines and forced liquidations." U.K. regulators have a similar fear, and they've responded by lowering the amount of assets insurers need to hold above their liabilities to policyholders - and crossing their fingers. CORPORATE ACCOUNTABILITY Making Scandals Add Up to Reform Faster than a plunging Enron share, tougher than a bear market, the U.S. Congress last week whisked through the biggest changes to business oversight in 60 years, creating harsh penalties for fraud and an independent board to regulate accounting. But the legislation is silent on one controversial accounting trick, treating stock options as expenses when...
...handshake or the strength of a family name. When the oil boom went bust, as it did for Bush in the mid-1980s, small-business men didn't cash out their stock options and run; they took pay cuts and tried to help their employees. To Bush, Enron and WorldCom were aberrations, the fault of a few bad actors in an otherwise sound system. "We were, like, What in the world?" says Commerce Secretary Donald Evans of his conversations with Bush. "We were just kind of bewildered. It is unbelievable...
Thanks to the Enron and WorldCom corporate accounting scandals, whistleblowing is enjoying a renaissance in the U.S. Both Cynthia Cooper, the internal auditor who sounded the alarm over WorldCom's $3.8 billion in bookkeeping shenanigans, and Sherron Watkins, who first voiced concerns about Enron's accounting tricks, have won acclaim as right-thinking individuals struggling against morally bankrupt business cultures...