Skip to comments.Arthur Andersen indicted for obstruction of justice in Enron scandal (BREAKING AT DRUDGE)
Posted on 03/14/2002 12:12:00 PM PST by TLBSHOW
Arthur Andersen indicted for obstruction of justice in Enron scandal
NOTHING FOLLOWS YET
This is not Disney World...
Indicting the company means that Andersen is now FORBIDDEN from performing the SEC audits of all public (read: Fortune 5000) American companies. It should also get Andersen tossed from its government auditing contracts (e.g. at the FBI).
Now we just have to see how much of its assets that Andersen can illegally transfer off-shore before the lawsuits and damages eradicate the company.
And of course, whether any of this impacts Andersen Consulting (aka Acenture) financially...
Andersen is dead. Frankly, it lived too long, anyway. It was corrupt for years.
Also, the second shoe will be dropping on AA probably this week. The SEC may say that AA is not capable of correctly handling audits of its clients! Clients are running away from AA faster than world class sprinters at the Olympics.
Watch the rats in the senate like LIEberman and Hollings drop Demron gate like a hot coal and run away from it.
The house will be investigating Double Crossing or Global Crossing very quickly! Of course CNBCNBCCBSCNNABCCSPAN will run away from covering this story. The NY and LA Slimes will cover Double Crossing and try to blame it on the repubies. The Washington Compost will lie about as it does in every story!
Will AA take the poison pill this month or will it last to Memorial Day?
It was alleged in their defense that the main office had sent a memo reminding the Houston Partner's office that the Document Retention Policy of AA called for (1) Work/Preliminary Documents be disposed of and (2) Final Documents and workpaper versions be retained and (3) if a legal inquiry was proceeding to preserve all documents that might be called for by law (my paraphrase). No the Main Office felt that such action showed their willingness to prevent destruction of evidence. The government contends (IMHO) that the Policy memo was a back-handed way of telling the branch office to "clean their house" of incriminating evidence.
The signifigance of the LLC being charged and not just a partner is that such would bar AA as a whole from conducting Audits needed for SEC filings -- i.e., puts them out of business absent an SEC waiver which stops only the Houston office. But you see, SEC wants to maintain a deep-pocket reservoir to go after for media results and doesn't want to let the whole company off the hook. Justice doesn't want to worry about the actual culprits cause that could shield the deep pockets/ big-trophy of the whold firm being charged so they name the entire firm first....more headlines.
Hell, the Enron CFO who perpetrated this whole shebang hasn't been charged....might as well put an arrogant ol' line Audit firm out of business....
I'm just a tad bitter about this whole thing though......after all we just spent 8 years with a criminal conspiracy in the executive being ignored by 80% of government and all of the media......but, hey, its a big-business, oil croney, Republican in office, doncha know.... gotta protect those 401k fools
This is gonna be good...they [congress] are gonna find out that the whole tapestry includes them....I wouldn't be surprised if this mess is shoveled out the back door like a big pile of stinking dog crap
Thanks to Registered for sharing this slice of his talent with us!
message: Stealing is fine if you make sure you say you are liberal, a Democrat or in the legal profession.
The fact is Enron was doing a giant scheme that could not ever work. The company started out as a stodgy but profitable oil and gas company. Then it started dealing in energy futures. They didn't call em futures, but Arthur Andersons management had to know that is what they were.
The futures business is at at best a 4 percent return business. It is legit and there is nothing wrong with those that go into it. What is wrong is when a futures company starts playing the futures. That is a prescription for going broke. But they guessed right for a while and for a while made big returns. They felt they had invented a new way to make money. But when the market fell they lost it as fast as they has made it. Like many before them they tried to cook the books until their "luck" changed.
Anderson was surely to be aware they were helping people cook books. An accounting firm that can't tell when people are cooking the books is negligent indeed.
Arthur anderson reminds me of the bank guard who was on duty when the bank was robbed. His excuse for not preventing the robbery, was he was taking his afternoon nap when the robbers showed up.
Arthur anderson's top people were in on the rip off, or they were taking nap when the books were a being kept.
Hillary Clinton should be sweating
Do you feel that this is the end of AA?
I had a major accouting firm tell to me, I could do something I was not sure I could. I said, "If you are wrong, you are in a lot of trouble." Being an honest accountant he said ,"No when an accountant is wrong it is the client that is in a lot of trouble."
Perhaps Bush is putting the shoe on the right foot. If accountants are paid the big bucks, and sign off on stuff that turns out to be illegal, they should pay the price.
Anderson is history. It will be a very long time before another accounting firm pulls somthing this stupid or illegal in order to get a big hunk of short term money.
There is so much coming down and bubbling out on so many critical subjects, we need great indexers like you, Shermy and Ernest at the Beach (I'm sure that I have omitted at least 100 good indexers) to help us keep track of all of this stuff.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.