John McLaughlin: "Ten more major corporate ethic scandals will surface over the next six months."

TMG ^ | 22 June 2002 | John McLaughlin

[buaya]

Over the weekend (21-22 June), I caught the last segment ("predictions") of The McLaughlin Group TV program.

Host John McLaughlin's prediction:

"Ten more major corporate ethic scandals will surface over the next six months."

Since then, we've had the Worldcomm, and today, the Xerox revelations.

Anyone want to start placing bets on Numbers 2-10???

[battlecry]

GE?? I think any company with a CEO book is probably fair game. (Except Norm Augustine's "Augustine's Laws")

[DoctorMichael]

This disease seems to be in the huge corporate heavy-hitters..................

My Choice: GE and Jack Welch

[1Old Pro]

It depends on the definition of major. By guess is 2-10 is far too low.

[Gorzaloon]

Sears Roebuck, or whatever is left of it.

[HAL9000]

2. SBC
3. Qwest
4. Charter Communications
5. Citigroup
6. Dell Computer
7. Comcast
8. Salomon SB
9. Bank of America
10. Oracle
11. Paypal

[Lady Jag]

Sears. BWAHAHAHA!

[RWCon]

Wal-Mart.

[Siegfried]

I think AOL/Time-Warner will be the next big one.

[rube]

The killer will be the gold scandal which will take down several huge financial institutions. Huge losses, manipulation, gold not there etc. Keep an eye on J.P. Morgan and the whole derivatives market.

Do a Google. GATA

Put on your seat belts. Its going to be a bumpy ride.

[Ken H]

Guesses--

Viacom-- We'll see BS from this one.
Time Warner AOL-- This is CNN's accounting.
Disney-- Goofy balance sheet.
GE-- Will bring bad things to light.

[Donald Stone]

I suspect that GE is going into a very defensive posture as we speak.
I recently was personally contacted by a very high level executive from a division of GE about some 1998 litigation I was involved in.
I suspect that it may have something to do with the huge GE bond offerings and certain so-called professionals that were associated with those bond offerings.

[Rodney King]

Yes, Jack Welch is going to be exposed as one of the biggest fraud's of the century.

[mware]

Shares in General Motors, the biggest US motor manufacturer, were briefly suspended on the New York Stock Exchange on Thursday amid rumours - strongly denied by the company - that it was subject to unspecified accounting problems.

It looks like McLauglin is turning into quite a prophet.

[ladtx]

Disney
GM
Verizon

[pepsi_junkie]

I heard or read a blurb about a poll of corporate ethics officers regarding corporate scandals. This was in response to the Tyco mess, prior to worldcom. They all said we could expect about 20 more scandals before it's done. Of course I wondered why if you are a bunch of crooks you bother to have an ethics officer, and if you have one why you would actually tell him anything but I guess they did.

My vote: GE. Despite efforts by his officially sanctioned biographers to portray him as a nice man who just wants whats best for his employees he was a ruthless by-the-numbers man, do anything for a buck. They didnt call him neutron Jack for nothing. While I was getting my masters degree I cringed whenever I was in a Wharton classroom listening to the profs (who were just about all exceptional, IMHO) use Jack Welch and GE as an example of the way business ought to be, share price is everything. I cringed because deep down I was and am conviced that he's a crook. And in the light of day we are now being exposed to, it'll turn up. GE has held a bunch of meetings with analysts to try to explain how they did the accounting for GE Capital and so far it hasnt helped. If its that confusing to experts you know they played with the rules.

By the way, GE is an icon of american industry. Far more so than Tyco or Worldcom or Enron. If it goes down to an accounting scandal it would send a real shockwave across the markets. Everything up to now will seem like ripples compared to a tidal wave I fear. Hope I'm wrong!

[Trust but Verify]

I'm with you on that. AOL buying up the huge Time/Warner? Warning bells for me.

[mugsaway]

Loral...

[pepsi_junkie]

AOL is a possibility. You know all those CD-Roms AOL is always giving out? That would appear to be a classic expense, you write it off and it diminishes your earnings that quarter. To avoid that, years ago AOL classified the costs of that as an asset (you see, it creates new users) and depreciated it over several years so it wouldnt immediately smack their earnings numbers. I dont think they do this anymore but its not too far from the mark of what Worldcom admitted to doing and if you bend the rules once (I think in AOLs case it was considered okay but kinda on the edge) youhave to assume they are willing to have done it again in other areas. We'll see.

[KC_Conspirator]

Amtrak