What accounting scandal happened with Waste Management?
The Perpetrators. The Securities and Exchange Commission files suit against Waste Management on March 26, 2002. They alleged that the company inflated profits by 1.7 billion dollars while making millions of dollars for the top executives and defrauding investors out of 6 billion dollars.
What was the Waste Management scandal 1998?
Waste Management Inc. is a waste company founded in the year 1968 by Larry Beck in the USA. Various frauds were discovered in the company in the year 1998 which were happening since 1992. All these fraudulent changes in the account books allowed the company to eliminate at least $500 million as operating expenses.
How was the Waste Management scandal done?
Because Waste Management, Inc. was a publicly traded company, the company was required to audit their accounting books. They hired Arthur Andersen, one of the Big Five firms, for the audit. committing fraud with their accounting books, but now they were also committing illegal acts by bribing Arthur Andersen.
What happened to the auditing firm of Arthur Andersen as a result of their Waste Management audits?
WASHINGTON — The Securities and Exchange Commission, in one of the first fraud cases ever filed against a Big Five accounting firm, fined Arthur Andersen LLP and three partners more than $7 million in connection with audits of Waste Management Inc.’s annual financial results.
What were the penalties of the waste management scandal?
The Houston-based company — the world’s largest trash hauler, according to Bloomberg — agreed to pay $17.1 million in penalties on behalf of founder and former chairman Dean Buntrock, who the SEC accused of leading a massive accounting fraud.
What happened in the Freddie Mac scandal?
In December 2003 Freddie Mac, the federally chartered mortgage financing giant, agreed to pay a civil penalty of $125 million and implement measures to correct its accounting and governance problems as part of a consent order with a federal regulator.
What was the Arthur Andersen scandal?
On June 15, 2002, Andersen was convicted of obstruction of justice for shredding documents related to its audit of Enron, resulting in the Enron scandal. Although the Supreme Court reversed the firm’s conviction, the impact of the scandal combined with the findings of criminal complicity ultimately destroyed the firm.
How could the Tyco scandal have been prevented?
In choosing the Tyco Inc. Board of Directors, Kozlowski only picked his own people and composed the firm’s corporate governance system. Having an impartial 3rd party without interest in the company to perform audits would have prevented the unethical practices at Tyco.
How long did Arthur Andersen audit Waste Management?
Over this seven-year period, while Andersen’s corporate audit fees remained capped, Andersen also billed Waste Management corporate headquarters $11.8 million in other fees, much of which related to tax, attest work unrelated to financial statement audits or reviews, regulatory issues, and consulting services.
How much was Herbert Getz ordered to pay the SEC to settle their claim against him?
“It involved highly complex and judgment issues that would have resulted in a long and complicated trial. My client decided it was better to settle the case.” Waste Management said it also agreed to pay $7.6 million for Phillip Rooney, $1.15 million for Thomas Hau and $950,000 for Herbert Getz.
What is the difference between Fannie Mae and Freddie Mac?
The primary difference between Freddie Mac and Fannie Mae is where they source their mortgages from. Fannie Mae buys mortgages from larger, commercial banks, while Freddie Mac buys them from much smaller banks.
Did Fannie Mae get bailed out?
The Fannie Mae and Freddie Mac bailout occurred September 6, 2008. The bailout came as the U.S. Treasury Department was authorized to purchase up to $100 billion in preferred stock of the organizations and buy mortgage-backed securities.